Business Interruption Insurance: Small Business Savior During The COVID 19 Pandemic?

It is carried in some small business insurance policies, but can business interruption insurance save one’s fledging business in the time of the COVID 19 pandemic?

By: Ringo Bones

If you still don’t have this coverage, it is likely too late to purchase it now as insurance companies usually won’t cover losses for a crisis that’s already underway. However, after COVID 19 blows over, you should look at this small business insurance policy in the future. Some small business insurance policies carry business interruption insurance clauses, either as a stand-alone policy or part of an overall package policy. Depending on the type of policy your business holds, you may have coverage for some types of losses. However, there’s a good chance the coverage might be limited or contain exclusions.

After the Severe Acute Respiratory Syndrome (SARS) outbreak in 2003, many insurance companies have updated their business interruption policies to exclude infectious diseases. Every policy varies, so it depends on the wording of your policy, its exclusions and limitations. Review your policy and talk to your insurance agent to see what, if anything, your policy covers.

Could Lloyd’s of London Insurance COVID 19 Claims Rival That Of 9/11?

Since the WHO declared it to be a pandemic back in March 2020, could the Lloyd’s of London’s COVID 19 insurance claims rival that of the September 11, 2001 era terror attacks?

By: Ringo Bones

Back in May 2020, Lloyd’s of London is likely to pay out 3.0-billion to 4.3-billion US dollars in insurance claims related to the COVID 19 pandemic, similar to losses from the September 11, 2001 terror attacks. This is largely due to the pandemic causing a lockdown on economies around the world, bringing business, events and travel to a halt and leading to hefty claims. And according to Lloyd’s, global non-life underwriting and investment losses for the whole of 2020 could hit a record 203-billion US dollars. Zurich Insurance is also looking at 750-million US dollars in non-life pandemic claims for 2020.

In a double blow to the industry, insurers have also lost money due to falling markets, slashing the investments they use to pay out claims. Global insured loss forecasts of 107-billion US dollars are similar to natural catastrophe losses in 2005 led by Hurricanes Katrina, Rita and Wilma and to 2017 including Hurricanes Harvey, Irma and Maria, according to Lloyd’s. The company’s estimates do not include life insurance and assume continuing social distancing and lockdown measures in 2020, as well as a drop in global GDP.

The bulk of the insurance losses come from cancellation or postponement of major events around the world – including the 2020 Tokyo Olympics, business interruption claims on property insurance and trade credit. Small businesses in Britain are battling insurers who they say have denied them payments for disruption. The insurers say most small business policies do not cover the COVID 19 pandemic. Lloyd’s of London insurer Hiscox is one of those under scrutiny.

Lloyd’s Of London Finally Bans Alcohol and Drugs In The Workplace?

It hit the news back in Tuesday, April 9, 2019, is alcohol and drugs really a big problem at Lloyd’s of London?

By: Ringo Bones

Wasn’t the world-famous insurance corporation Lloyd’s of London started a coffeehouse? During the beginning of the 18^th Century, Edward Lloyd’s coffeehouse was one of the foremost places where insurers, brokers and underwriters of common interests meet. It is of interest to note that Mr. Lloyd would not allow a man to write his name under a contract of insurance in his coffeehouse unless certain of the underwriters’ ability and willingness to pay up in the event of loss.

Fast forward to April 2019, Lloyd’s decision to finally ban drunkenness in the workplace was in part to the rise of complaints of sexual harassment and related disgraceful behavior during the past few years that was caused primarily by personnel who got a bit too much wine during lunch. Which is quite ironic, really, given that Lloyd’s of London was originally a coffeehouse. And as part of a code of conduct to be unveiled this week, people attending to enter the market under the influence of drugs and / or alcohol will have their passes confiscated.

Whether this is actually enforceable, only time will tell, but pity the security guards who will be in the front line of this. The security guards will now have the unenviable task – I mean how will they react when a powerful and influential broker staggers in at one in the afternoon after having a bit too much to drink at lunch and starts making threats when they are told to surrender their pass and told to go home?

Could Climate Change Make Insurance Coverage Too Expensive For Most People?

Given that the world’s largest reinsurance firm – Munich Re – warned us five days ago that insurance premium rate rises could become a social issue, is climate change making insurance coverage too expensive for ordinary people?

By: Ringo Bones

Insurers around the world manage to reach a consensus five days ago to issue a warning that climate change could make coverage for ordinary people unaffordable after the world’s largest reinsurance firm blamed global warming for 24-billion US dollars (18-billion UK£) of losses in the California wildfires. Ernst Rauch, Munich Re’s chief climatologist, told the Guardian newspaper that the costs could soon be widely felt, with premium rises already under discussion with clients holding asset concentrations in vulnerable parts of the state. From my point view, it could only be a matter of time for insurance claims adjusters, insurance brokers and anyone at the leading insurance companies’ underwriters’ box to set premiums rates for flood and fire insurance for Malibu, California homeowners to rival that of Lloyd’s Of London’s “unique risks” coverage – i.e. coverage for risks whose actuarial figures and adequate tables of probability are not available, as in like those of insurance coverage for the sudden reappearance of the “Loch Ness Monster”.

According to Munich Re, the lion’s share of California’s 20 worst forest fire blazes since the 1930s have occurred in the 21^st Century, in years characterized by abnormally high summer temperatures and “exceptional dryness” between the months of May and October. And Munich Re’s chief climatologist Ernst Rauch states that: “If the risk from wildfires, flooding, storms and hail is increasing then the only sustainable option we have is to adjust our risk price accordingly. In the long run it might become a social issue”. Too bad there’s still no coverage yet for a so-called “President Trump Climate Change and Global Warming Denial Insurance”. 

Can Safer Air Travel Lower Airline Travel Insurance Premiums?

Given that air travel fatalities has been in decline for the past 20 years and 2017 was declared as the safest year for airline travel, will the trend result in lower airline travel insurance premiums?

By: Ringo Bones 

Even though air crash fatality payouts in airline travel insurance policies are de rigueur, most air travel insurance policies are advertised for other reasons. Why buy airline travel insurance? Well, these days flights and hotels are booked but one needs to protect his or her vacation investment after shelling out significant amounts of money and those whose day-jobs involve weekly airline travel trips involving 500 miles or more, concerns arise if… A) You come down with the flu just a few days before your departure? B) The tour operator for your 2-day excursion suddenly declares bankruptcy? Or C) You are unexpectedly laid-off from your job? 

Major insurance providers already provide airline travel insurance to help protect your trip investment by taking the worry out of unforeseen circumstances that could disrupt your plans. Most of them can provide trip cancellation coverage, giving your cash back for up to 100-percent of your trip costs for reasons like: termination by employer, covered illness or injury of you and your traveling companions, airline stopping services for at least 24 hours due to natural disasters such as hurricanes, named severe storms or earthquakes. Affordable plans start as low as 17 US dollars and coverage is usually around 1,500 US dollars per person for flight cancellations and 300 to 500 US dollars a day for trip interruptions. Will these premiums get even lower given that 2017 was declared as the safest year ever for airline travel and airline crash fatalities has been in decline during the past 20 years? 

Despite of the tragic and scary chapter that we call 9/11, the mysterious disappearance of Malaysia Airlines Fight MH 370 back in March 8, 2014, the shooting down of Malaysia Airlines Flight MH17 over Donetsk by a Russian made Buk surface-to-air missile back in July 17, 2014, the number of airliner accidents has been in a slow and steady decline during the past 20 years. Harro Ranter, president of The Aviation Safety Network said: “Since 1997 the average number of airliner accidents has shown a steady and persistent decline, for a great deal thanks to the continuing safety-driven efforts by international aviation organizations such as ICAO, IATA, Flight Safety Foundation and the aviation industry.” 

The Dutch consultancy To70, estimated there was now one fatal accident for every 16-million flights, although its report was compiled before the Costa Rica crash occurred. While the Aviation Safety Network’s report shows that the accident rate now stands at one fatal passenger flight accident per 7,360,000 flights. If cargo planes were included, a report by the Airline Safety Network shows that there were a total of 10 fatal accidents, resulting in 79 deaths for the whole of 2017, compared with 16 accidents and 303 lives lost in 2016. The organization based its figures on incidents involving civil aircraft certified to carry at least 14 people. Given the statistically significant decline in airline accident fatalities during the past 20 years, should these translate to lower airline travel insurance premiums?

Jamii Insurance: Best Health Insurance For The Poor?

With premiums at only 1 U.S. dollar a month, is Jamii Insurance the best health insurance for Tanzania’s poor? 

By: Ringo Bones 

Even though they badly needed it, health insurance is a novel luxury in Tanzania. The penetration of health insurance is as low as 4.5-percent, which means that the majority of Tanzania’s low-income and informal workers do not have access to insurance and struggle to pay for health services. As a recent add-on to the company’s financial cooperative groups, Jamii Insurance has been recently hailed by its clients for being able to provide top notch healthcare while only asking for a premium of only 1 U.S. dollar a month. Best of all, it is payable via a mobile phone payment system like M-Pesa. 

The low income population of Tanzania – 47 million people in total – earns less than 70 U.S. dollars a month. For them, income is also dynamic, especially to informal workers / self employed who sometimes earns 200 U.S. dollars for this month but virtually none the next which also makes having a sizable savings account in a bank a luxury. This population in Tanzania also suffers from high rate of maternal deaths due to unsupervised home births and death from curable diseases due to lack of money to pay for medical services. Jamii Insurance comes as a much needed solution to this ignored population. Given that a sizable population of the poor already own mobile phones, this makes it much easier to perform the administrative activities of the insurer. 

Jamii is matched in strategic partnership with Jubilee Insurance and Vodacom. This helps cut insurance administration costs by as much as 95 percent, this enabling Jamii to offer a health insurance product with a premium for as little as 1 U.S. dollar a month. As a micro-insurance health startup that provides health insurance targeted at Tanzania’s low income population through their mobile phones, Jamii Insurance has been hailed as a miracle based on the service it has been able to provide.

Dengue Insurance: A Necessity In Tropical Regions?

If you live in a tropical region where the healthcare system is not as good as “Obamacare”, is dengue insurance a good option?

By: Ringo Bones 

Filipino nurses in the United States who have benefited from Obamacare often wonder why the Philippine government isn’t working hard enough have a healthcare system as good as one established. But given that something like this is still currently “science fiction”, will a kind of dengue insurance like the Pioneer MediCash Dengue Insurance be the next best thing? 

Given that dengue fever has financially devastating consequences when it afflicts fixed income people in the Philippines, a disease specific health insurance policy with an affordable premium would be an excellent option. Recently, I’ve checked out if one is locally available in the Philippines and as luck would have it, I’ve stumbled upon the Pioneer Pioneer MediCash Dengue Insurance. It is basically a disease-specific health insurance that provides a lump-sum payout of PhP 10,000 (which is equivalent to a little over 200 US dollars) medical assistance in the event that the policyholder is diagnosed with dengue fever – even if the diagnosis does not require a hospital stay. 

And even if you already have an HMO like Philhealth, there is still value in availing oneself of Pioneer MediCash Dengue Insurance. You still get your PhP 10,000 lump-sum payout on top of your HMO and Philhealth benefits to take care of other medical expenses. Receipts or hospital bills are not required as MediCash pays with just a valid doctor’s diagnosis accompanied by the diagnostic test results. The Pioneer MediCash Dengue Insurance only costs PhP 350 a year – which works out to an insurance premium of less than one peso a day to be your basic health insurance against a common tropical disease like dengue. 

It is relatively easy to apply for the Pioneer MediCash Dengue Insurance, you just need to pay for an activation form at SM Bills Pay and complete the personal information form. No medical questionnaires are required. And when it comes to the beneficiaries, you, your family members, friends and household staff are eligible. When it comes to age requirement, applicants ages 1 to 70 are eligible. 

Unfortunately, like most health insurance policies, there are preexisting condition restrictions. Someone who already sick with dengue are ineligible for the PhP 10,000 benefit because the Pioneer MediCash Dengue Insurance has a 15-day waiting period, which means that the insured should not be feeling the symptoms of dengue, not be showing signs of dengue, not have consulted a doctor for dengue and not make a claim for dengue. 

To get the PhP 10,000 benefit, once you are insured over the 15-day waiting period and start feeling the symptoms and signs of dengue, you should consult a doctor. And then ask the doctor to complete the Claims Supplementary Medical Report (CSMR) which is like a medical certificate and comes with your Pioneer MediCash Coverage Summary. Then take a digital photo of your CSMR and the diagnostic results with your smartphone and then send the photo via email to reatail@pioneer.com.ph or viber to +63 917 5317213.