How Insurance Can Help Ease the Pandemic’s Toll on Consumers



Over the past two-and-a-half years we’ve seen the world re-configure at a dramatic pace, says Katrina Shanks. It has also highlighted that quality financial advice is a key tool during uncertain times…


If we want more people to benefit from being advised on financial matters – as we do – it’s important to understand what they are looking for, their changing behaviours, and their most pressing needs.

With this in mind, I recently came across new global research from Swiss Re Institute. This year, it surveyed 11,000 consumers across 20 international markets, including New Zealand, looking to measure the impact of the pandemic on people’s health and financial security, with a focus on insurance uptake. It was a dense read, and here are some findings that stood out to me.

Care and risk management

One of the overarching findings is that the pandemic has lifted people’s risk awareness. And importantly, consumers are not just voicing their concerns – they’re also researching solutions.

According to Swiss Re’s global data, Covid-19 was a catalyst for people to have more regular health checks, especially in emerging markets. And in most markets of the Asia-Pacific region, this is driving demand for new or additional cover. However, it’s interesting to note that local data tells a slightly different story.

New Zealand respondents reported being 15% more concerned than last year about their overall health as a result of Covid-19, but they haven’t researched insurance significantly more. And even among those countries where insurance interest has increased, the research-to-buy ratio remains still quite low (about 48%, down 2% from 2021).

So, what are the roadblocks? According to Swiss Re, this may indicate a mismatch between consumer needs and what’s available in the market – from cost concerns through to product features.

Perceived value

With inflationary pressure felt across the board, it’s not surprising that cost of insurance and consumers’ perceptions of getting good value-for-money are key factors in purchasing decisions across all markets.

Katrina Shanks, CEO, Financial Advice NZ (2020)
Katrina Shanks, CEO, Financial Advice NZ.

This is likely to shy away lower-income consumers from protecting their financial future, which in turn exacerbates their lack of financial resilience.

As an industry, our collective focus needs to be on educating Kiwis on the value of insurance, and how advisers can help them research solutions that meet their goals and budget needs. In other words, consumer perception is everything and it stems from trust in advice.

Of course, we know that change doesn’t happen overnight – it’s a continuous journey made of small steps in the right direction. So, we just need to keep going.

Mental health

Earlier this year, the World Health Organization (WHO) revealed that global prevalence of anxiety and depression increased by 25% in the first year of the pandemic. Stress factors included social isolation, fear of infection, and grief after bereavement, with young people and women feeling the impact on their well-being more than any other demographic.

The WHO called this a ‘wake-up call’ for nations to focus on mental health and bridge the gaps in care. The Swiss Re’s survey echoed this sentiment, while also highlighting the growing role of insurance in helping people improve their mental resilience.

According to their data, there’s a rising awareness of mental well-being in most markets including New Zealand, with 35% of Kiwi people surveyed reporting that their mental health has deteriorated in the past 12 months. The good news is that 45% of New Zealand respondents have taken steps to improve their mental well-being since the pandemic started.

Of course, more can always be done. But it must be noted that many insurers are acknowledging the importance of mental health in their offerings, including complimentary support and telehealth. And I know advisers are doing a great job out there at aiding vulnerable clients.

As research confirms, by combining trusted human interaction with user-friendly digital options (such as virtual care solutions), the insurance industry can make a big difference. It’s all-the-more important that we show Kiwis from all walks of life that help is available.

Consumer data

Another interesting finding from the survey was that, globally, two-thirds of all consumers are willing to share their data, if that means getting personalised benefits and custom health advice.

Granular data is crucial when it comes to informing underwriting and enabling insurers and advisers to provide tailored solutions to clients. And the importance of treating this highly personal information with care cannot be overstated. The more information clients are willing to share, the more careful we all need to be in protecting it.

Here to help

Financial Advice NZ was founded with a single-minded purpose: to help New Zealanders, and New Zealand as a whole, be financially better off.

See: Pandemic Resulted in More Online Insurance Transactions