No matter how prepared we think we are for a pandemic, the reality is that things can move and change quickly within a matter of weeks or days or hours. Businesses can find themselves struggling to keep pace as the pandemic’s growth and impact hijacks the in-place risk management framework. How an organisation responds during a pandemic like COVID-19 will not only depend on its preparedness and resources, but also depend on at what stage of the pandemic’s lifecycle it is operating in.
To successfully manage an organisation’s business and people through a pandemic, organisations need to be agile and develop bespoke response strategies tailored to their business and risk profile, which are then tested constantly to ensure their effectiveness. Marsh’s Pandemic Response Lifecycle tool can help organisations navigate through the five key stages of a pandemic: Pre-pandemic, Pandemic International Outbreak, Exponential Pandemic Growth & Business Interruption, Pandemic Recovery, and Post-Pandemic. By uncovering the changing risks and challenges throughout the various phases, the pandemic lifecycle helps organisations determine the most effective ways to respond to and manage these challenges.
During times of uncertainty and economic downturn, the impact of any financial implications can often be more intensified and have a material impact on any business. As organisations navigate through a pandemic, they can explore potential cost saving opportunities through insurance rebates and Workers Compensation adjustments, or examine ways to improve cash flow through premium funding solutions or surety bonds. Despite the hardening of the insurance market, Risk Finance Optimisation can potentially help an organisation help reduce premium spend by determining the optimal policy limit and retention levels that will result in the most cost effective outcome of structuring an insurance program.
Organisations should be proactively managing their balance sheet and exploring cost saving options, as any savings achieved during a pandemic could potentially influence the viability of a business both during and post-pandemic.
Regardless of which phase of the pandemic lifecycle we are in, an organisation’s people should be at the heart of its response strategy to ensure continual functioning of the business without jeopardising the wellbeing of its employees.
Whilst the initial focus may be on staff communication and workplace social distancing strategies, as the pandemic gains momentum and causes business interruption, organisations need to shift their focus towards workplace infection reduction strategies and remote working policies, including home assessments and upskilling managers. It is also imperative to provide accessible Employee Assistance programs and services to staff during times of uncertainty and change.
As the world recovers from a pandemic event, organisations need to work out the best way to bring staff back into the workplace and ensure productivity levels return to at least pre-pandemic levels. Return to Work Programs and Fitness to Work assessments can be valuable tools to help organisations achieve this.
As COVID-19 makes its unprecedented mark on businesses across the board, organisations are forced to adapt to the interruption and changes triggered by the pandemic. Immediate and long-term implications can result in increased or new liabilities and risks, such as increased employee and third party liabilities, increased D&O liabilities, working from home cyber and security threats, and human resource implications (e.g. from sudden redundancies).
Given an organisation’s risk profile may look very different pre-pandemic versus post-pandemic, Insurable Risk Identification and Insurance Gap Analysis are valuable exercises to conduct to ensure an organisation’s risk profile is up-to-date and well understood by decision makers and key stakeholders, including insurers.
How do organisations plan, respond to and recover from a pandemic like COVID-19? Has the business continuity plan been properly tested before being mobilised? What actions should be taken now versus in six months' time, and are there alternative ways of managing risk?
Independent risk assessments, crisis management planning, financial feasibility studies, outsourcing non-operations functions (eg. Work Health & Safety) are ways to help mitigate and manage an organisation’s risk throughout the pandemic lifecycle. As businesses navigate through these issues, the actions taken and learnings from today will help to shape organisations’ preparedness for the next crisis.