Changes ahead for the Buy Now Pay Later sector: Key implications for Australian FinTechs

Finance

Cries for regulation in the currently self-regulated Buy Now Pay Later (BNPL) sector are nothing new. Financial services providers and consumer rights groups have long expressed concern that these services enable financial overcommitment from vulnerable Australians. But are we reaching a point where the size and scale of these businesses, the emergence of several new market entrants, and the disruption to traditional credit markets is forcing the Government’s and regulators’ hands?  This article looks at the current situation for BNPL FinTechs in Australia, how insurers currently view their risk exposures, and how this may change if regulations are introduced.

 

THE CURRENT STATE OF PLAY

In 2018, digital laybuy platform Afterpay and the BNPL sector avoided regulation when ASIC reported it was not looking to bring them under the National Credit Act. In late 2020, a Senate Committee on Financial Technology and Regulatory Technology backed the BNPL sector’s code of practice, saying self-regulation helped to protect innovation. This code is currently being finalised by The Australian Finance Industry Association (AFIA) in collaboration with its BNPL members. It aims to have the BNPL industry Code of Practice operating by 1 March 2021.

Recently, however, a report provided to the UK’s financial regulator, the FCA, following a review of the unsecured credit market, has made the strongest case yet for implementing regulation within the BNPL sector, at least in the UK.

 

HOW WILL THIS IMPACT THE AUSTRALIAN MARKET?

The BNPL sector is never far from the sights of ASIC, which released an industry update in November 2020. ASIC currently holds Product Intervention Powers (PIP) over BNPL products which provides a regulatory tool to address any significant harm to consumers. Come October 2021, the Design and Distribution Obligations (DDO) legislation will also apply to most ASIC regulated products, which will include BNPL products.

Whether these regulatory controls, complemented by industry self-regulation, will provide consumers sufficient protection without stifling innovation remains to be seen. What is certain, however, is this topic remaining hot for a while yet. According to IBISWorld, the market is predicted to maintain strong growth, with Australian BNPL revenue forecast to grow from AUD 680M (USD 488M) in FY20 to AUD 1.1BN by FY25, with users set to double to 4M within three years.

 

INSURING BNPL FINTECHS IN AUSTRALIA

FinTechs are a blend of technology and financial businesses, exposing them to risks common in both sectors, where insurers’ appetites are commonly limited.

Examples of such risks include:

  • Technology risk – tech failures leading to 1st and 3rd party financial loss
  • Financial and credit risk
  • Financial crime, fraud, and identity risk
  • Cybersecurity and Data Privacy – 1st and 3rd party losses
  • Directors & Officers Liability
  • Public & Products Liability
  • Regulatory Investigations and Statutory Liability
  • Money Laundering risk

Although some do, BNPL FinTechs are not required to hold an Australian Credit Licence (ACL). Thus, in the eyes of insurers, they do not have the same responsibilities and obligations as ACL holders under the National Consumer and Credit Protection Act. This lack of regulation makes insurers nervous, and securing adequate insurance is therefore challenging. It will be interesting to see whether insurers’ risk appetites change if regulation is introduced into the BNPL sector – as recommended in the UK.

 

We’re with you all the way

With significant experience in the financial, technology and FinTech sectors, Honan welcomes the opportunity to assist all businesses operating in this space. Feel free to reach out at any time to discuss your insurance needs. 

 

Dominic Brettell

Head of Client Service – Corporate Insurance & Risk Solutions

dominic.brettell@honan.com.au

 

 

Discover the 4 Risk Protection Essentials for Tech Start-Ups.

Critical Cover for Cyber Crime: A Healthcare Imperative for 2021

Medical & Health

From an insurance standpoint, I’ve not witnessed a more challenging year than 2020. The bushfires of 2019-20 shook us to our core, and then COVID-19 hit. The resulting uncertainty has made it extremely challenging for businesses to regain solid footing. Concerns about revenue streams, staff wellbeing, and future forecasts swiftly became, and continue to be, boardroom imperatives. As health providers begin 2021, now is the time to pause and check critical insurance blind spots*, particularly cyber.

 

Cyber Crime: Healthcare’s Blind Spot

While most businesses traditionally focus on the core structures of their insurance programs such as property, professional risks, and equipment, 2020 saw more complex risks arise as a result of blind spots. Often seemingly minor, ‘blind spot risks’ are not always obvious, but certainly becoming more frequent and damaging, particularly to balance sheets. One of the most common blind spots I witness in healthcare businesses, is cyber crime, estimated to cost Australians $300 million each year.

2020 also saw the first death recorded as a result of cyber crime; a shocking precedent, which may signal a trend of worsening attacks on the medical industry, especially hospitals. Last November, the ACSC (Australian Cyber Security Centre) issued a warning to Australian healthcare providers about the rise in similar incidents, and a recent report on ransomware in Australia identified health as the most targeted sector, ahead of Government, education, transport and retail (shown below).

 

Figure 1: Top sectors impacted by ransomware as reported to the ACSC FY 2019-20

Source: Australian Cyber Security Centre, 2020.

 

Cyber Crime: What’s Your Response Plan? 

While I see a vast array of medical facilities in my role, my priority question for each of them remains the same “Do you have a Cyber Response Plan?” – a query typically met with “No” or “I think we have a policy”. Alarmingly, operating without an official Cyber Response Plan is equivalent to leaving the doors wide open when you’re not home. Cyber criminals do not discriminate based on victim circumstances, and to be blunt, they do not care. Knowing full well it may endanger lives, hackers will go as far as locking a hospital’s operating system, and demand a financial ransom to unlock it.

 

Cyber Protection: Where to Start?

Having a Cyber Insurance Policy is a great starting point for healthcare providers, but knowing how that Policy will respond, and what it will respond to is critical.

While many insurance brokers and underwriters are quick to mention Cyber Insurance, I believe there’s never been a more critical time to elevate Cyber Policy conversations. For healthcare providers, cyber cover should be considered a business-critical inclusion in their broader insurance portfolio, as early in discussions with brokers as possible.

The onset of 2021 marks an opportune time to revisit all blind spots in your business insurance portfolio. A robust policy portfolio will not only help protect your business, your people, balance-sheet and reputation, but your patients too.

Please contact me for further support at any time, or contact your preferred medical cyber insurance specialist to establish a clearer understanding of your risks.

 

*Keep an eye out for insights on other insurance blind spots in our future publications.

 

 

We’re with you all the way

 

Trent Woodward

Head of Health & Medical

trent.woodward@honan.com.au

 

Discover more about how cyber insurance works in this case study on Australia’s education sector.

You can read more about the importance of cyber insurance here.

4 Risk Protection Essentials for Tech Start-Ups

Technology

In October 2020, Apple announced its line-up of products that will support 5G, heralding a new era of technological advancement. While your tech start-up might not have the muscle of Apple just yet, your product or service could be solving equally important problems not yet identified in the market. And why not? Wi-Fi was famously invented here in Australia!

There are inherent risks when starting any new business, but from a liability standpoint, various insurances can greatly assist in mitigating risk. For Australian tech start-ups in particular, the following 4 insurance essentials are critical ones to keep in mind:

 

1. Secure a Comprehensive Information Technology (IT) Liability Policy

Almost every business is required to have Public Liability insurance, but tech start-ups also need to consider cover from an IT standpoint. From crime and defamation, to unintentional infringement of intellectual property, ensuring your IT Liability policy is comprehensive will help in mitigating risk. An IT Liability policy helps protect businesses against claims relating to failure of their products, advice or services. In many cases, a Professional Indemnity policy will not respond to losses related to the supply of goods, while Combined Liability policy can exclude pure financial loss, where personal injury or property damage has not taken place. To reduce uncertainty and maintain comprehensive coverage, an IT Liability policy is tailored to cover Professional Indemnity and Combined Liability under one umbrella. When placing an IT Liability policy, be sure to take note of any extensions and exclusions – these may be relevant in the event of lodging a claim.

 

2. Prioritise Cyber Insurance

It is estimated that cybercrime costs Australian businesses $29 Billion each year. Together with the rise of remote working practices and the IT vulnerabilities this has revealed, we expect cyber security to remain business critical for years to come. There are many Tips for Remote Working, Cyber Security and Avoiding Email Scams, but even the most tech savvy individuals can fall victim to cybercrime. A data breach can prove costly not only for your clients, but for the reputation, operations and ongoing viability of your tech start-up. In the event of a data breach, a robust Cyber Insurance policy can bear the cost incurred to reduce your future risks, resume business and, when needed, pay retribution for your clients’ losses. Learn more about cyber insurance and how it works in this case study on Australia’s education sector.

 

3. Review Limits & Sub-Limits of Liability

With limits of liability varying from $500,000 for cyber coverage to $10M for IT, having the correct coverage limits in place is crucial to avoiding being under or over insured during the policy period. Recommended levels of coverage are often advised based on any contractual liabilities between you and your clients. The size and annual turnover of your business can also help in determining the most comprehensive, and competitive policy for your start-up.

*Be mindful of sub-limits that form part of these policies, as the extensions that form part of the policy may not cover the full indemnity. For example, while an IT Liability policy may cover up to $1M for any one claim and $2M in the aggregate during the policy period, there may be a $250,000 sub-limit for product recall. Any financial costs above the sub-limit could see your start-up as financially responsible.

 

4. Enlist the Advice & Support of a Dedicated Broker

There are many variables that inform a robust insurance policy, and it will take time to tailor these to your start-up’s particular needs. A quality insurance broker does more than place your insurance policies, they identify risks and manage your entire portfolio of risk solutions.

The tips outlined above cover the basics of risk-protection for tech start-ups, but a dedicated, quality broker will support you in building a highly customised, blue-chip protection portfolio for your business. In turn, this frees you up to focus on what you do best – building your business!

 

We’re with you all the way

To find out how Honan can help support and protect your start-up, please reach out at any time. We’d love to hear from you!

 

Jason Holmes

Client Executive – Global

jason.holmes@honan.com.au

 

 

Discover more about how cyber insurance works in this case study on Australia’s education sector.

Natural Disaster Season is NOW: Critical Steps to Help Keep Your Business Protected

Industry

Alongside the promise of annual leave and great escapes, Australia’s long hot summer marks the height of natural disaster season – a notoriously stressful time for many business owners across the country. While the potential wrath of Mother Nature can leave us feeling powerless at times, significant steps can be taken by business leaders to mitigate the potential impacts to their operations, bottom line, and indeed livelihoods, in the event of a disaster. In the following piece, we’ll explore the two fundamentals for natural disaster risk-minimisation:

    1. Physical risk protection through mitigation
    2. Ensuring a comprehensive, truly ‘catastrophe-fit’ insurance program is in place.

 

PHYSICAL RISK PROTECTION VIA MITIGATION

Businesses can take the following preventative steps to ensure their physical assets are protected as much as possible in the face of disaster:

 

BUSHFIRES

    • Ensure all buildings, plant and equipment (including surroundings) are adequately insured for their replacement* value
    • Keep sites clean, with flammable materials stored off-site
    • Where possible, construct premises from fire-resistant materials
    • Assess business interruption exposures to key customers and suppliers in the event of bushfire.

 

CYCLONES

    • Have a cyclone emergency plan in place and familiarise your entire staff with the plan
    • Regularly monitor weather and associated alerts
    • Back up all electronic files
    • Secure all stock and equipment indoors if currently outdoors
    • Have a business continuity plan in place.

 

STORMS / FLOODING

    • Ensure your building(s) and surrounding properties are in a good state of repair
    • If possible, have alternative (backup) power sources available such as generators
    • If situated in a flood prone area, ensure stock / raw materials are stored at height
    • Secure all loose items indoors
    • Source an adequate number of sandbags (if more permanent flood barriers are not an option) for use in the case of emergency.

To discover more about protecting your home and personal assets from extreme weather, be sure to read Protecting Your Assets: Lessons From an Unprecedented Summer of Weather.

 

 

ENSURE A TRULY ‘CATASTROPHE-FIT’ INSURANCE PROGRAM IS IN PLACE

In the event disaster strikes, having a robust, ‘catastrophe-fit’ insurance program in place is critical to ensuring business continuity interruptions and implications are minimised. Strong insurance programs will cover off the following four pillars:

 

1. RISK SURVEY & ASSESSMENT

It is recommended that clients look to conduct a detailed risk survey of their key operating or business critical sites.  These are typically completed either by a qualified risk engineer who will identify and qualify certain vulnerabilities that may exist within a business, as well assessing:

    • The likelihood of these hazards causing a loss
    • The severity of a loss incurred by such hazards
    • The effectiveness of existing controls within the business to mitigate these hazards.

 

In some cases, existing controls do not completely mitigate identified losses, meaning additional levels of protection are needed. For instance:

    • Improved fire protection
    • Hot / cold working permits
    • Smoke/fire detection
    • Housekeeping
    • Introduction of business continuity plans.

 

Risk surveys will typically cover off:

    • Hazards (natural, man-made or operational)
    • Construction materials used
    • Surrounding exposures
    • Production ‘bottlenecks’
    • Existing levels of risk management.

Additionally, a risk survey will set out a number of recommendations (to mitigate risks) in an implementation plan.

 

2. ACCURATE & UP-TO-DATE PROPERTY VALUATION(S)

According to the Insurance Council of Australia, many properties destroyed in the summer bushfires earlier this year were underinsured, meaning they had cover but inadequate levels to replace or rebuild what was lost. Having accurate and current valuations of your buildings, plant, equipment, and stock will help businesses to ensure they’re adequately covered for their repair and / or replacement in the event of a loss. 

*Being underinsured can bring about financial hardship and a shortfall in cash flow. Thus, understanding the costs to replace all critical items of your business versus the original written or purchase value is imperative. Any capital expenditures (CAPEX) should also be taken into account when considering replacement costs of business assets.

 

3. BUSINESS INTERRUPTION (BI) REVIEW

Similar to a valuation of the business’ physical assets, a Business Interruption (BI) review focuses on the financial impact (profit or revenue) of the business and its ability to return to a pre-loss position following an event. Regardless of whether a business is affected directly, indirect losses can arise as a consequence of large-scale catastrophes, therefore understanding what exposures exist is vital. A BI review will assess factors such as:

    • Adequacy of current indemnity periods and whether they align to plant rebuild timeframes
    • Alternative location(s) to conduct business or source raw materials
    • Scenario-test existing scope and levels of cover
    • Exposure to key customers and suppliers
    • Ensure base cover adequately protects the business.

 

4. IN-DEPTH POLICY ANALYSIS

As businesses grow and expand, so too does their direct and indirect footprint. An in-depth insurance program review by your broker will help ensure all required policies are in place, and adequate for the protection of the business. This analysis will also uncover any uninsured risks or perils that may be excluded or limits/sub-limits that require adjustment.  This review should be completed in conjunction with the output from risk assessments, valuations and business continuity plans.

 

 

IN THE EVENT OF A DISASTER…CALL YOUR BROKER! 

Despite having minimised all physical risks, damage incurred by natural catastrophe is unavoidable. In the immediate aftermath of a bushfire, cyclone, storm or flooding, business owners should call their broker ASAP, and take the following steps:

    • Arrange for a contractor to undertake an ‘emergency make-safe’. This involves temporary repairs to ensure the property is watertight and to minimise/prevent further damage. If you’re unsure who to call, try the SES for emergency assistance.
    • Safely switch OFF the electricity, and contact an electrician to undertake checks.
    • Avoid black water – this is unsafe, contaminated water and must be left to experts.
    • Dry out wet areas – contact a restoration expert to extract water and commence the drying process (i.e. removal of wet carpets and installation of blowers, dehumidifiers).
    • Prepare an itemised list of damage and take photographs to support your claims process.
    • Dispose of spoilt and destroyed items. Again, it’s important to take photographs.
    • Keep any items that can be repaired. If in doubt, speak to your broker.
    • Obtain quotes to repair damaged items, which will help in the claims process too.

 

WE’RE WITH YOU ALL THE WAY

To learn how Honan can support you in protecting your business, people and operations ahead of a potential natural disaster, please reach out at any time.

 

Travis Wendt
Head of Corporate Insurance & Risk Solutions

travis.wendt@honan.com.au

+61 434 651 918

 

 

Learn more about protecting your assets from extreme weather with this guide.

 

 

Australian Education at Risk: How Cybercrime Insurance can Help

Technology

Around the world, Australia is recognised for its excellence in education and training. Contributing over $32 billion to our economy, this critical industry represents Australia’s third largest export. Unfortunately however, this sector is one of the most vulnerable to cyber threats, due to a high dependency on digital infrastructures and web-based learning. In 2017, the education sector alone accounted for 26% of cyber-attacks in Australia, and 57% of cybercrime across the Asia-Pacific region.

 

The Impacts: How it Hurts

At present, the Government estimates that cyber incidents involving Australian businesses cost up to $29 billion a year. The financial implications of cybercrime are overwhelming, but they extend beyond the balance sheet. Significant damage to an organisation’s reputation is also common, as demonstrated in the recent attacks on The Australian Catholic University, Australian National University and Toll Group.

The vast number of digital libraries storing sensitive personal data also makes the education sector highly attractive to cyber criminals. Personally Identifiable Information (PII), such as student records, make cyber breaches particularly damaging. Furthermore, high-risk technology systems, hardware and infrastructures such as laptops, tablets, interactive whiteboards, mobile phones and video conferencing are commonplace in the education industry. Designed and utilised by multiple parties across the sector, e-learning platforms also house data relating to students, teachers, curriculums and learning outcomes, all of which may be at risk.

 

How Hackers Work

Hackers are becoming increasingly sophisticated in their approach to hacking anti-virus/anti-ransomware software. Readily available through the dark web, hackers now use scanning tools to identify particularly vulnerable organisations, and to further isolate the weak points in their systems and networks.

Once a hacker gains access to a device, systems like malware and ransomware can be used to extract confidential information or shut down computer systems/networks, demanding a ransom in return for access.

 

Cyber Insurance: Protection Through Policy

Cyber Insurance can represent a low-cost way to help protect your business from the risks of cybercrime. Given most organisations are not able to resolve cyber attacks in-house, a robust Cyber Insurance Policy will include an Incident Response Team (IRT). Equipped to respond immediately, the client’s IRT can:

  • minimise further loss to the business (e.g. financial, reputational)
  • regain critical system access ASAP with a view to protecting systems and data
  • limit business downtime, minimising income loss as a result.

 

Cybercrime Case Study: How Honan Helped

Honan recently supported a client (Sydney-based driver training school) through a cybercrime event.

The cybercrime (insurable event)

A ransomware attack causing the booking and payment processing system to be down for five days, resulting in a $25,000 loss in revenue, plus IT vendor fees.

The resolution

Having a Cyber Security Insurance Policy in place with Honan meant the total costs incurred by the client were covered by their insurance premium. Beyond potential financial loss, the IRT provided valuable insights into the type of attack and the resulting damage. The IRT conducted analysis of the client’s systems to limit the risk of further attacks.

 

 

Honan – we’re with you all the way

For more information on how to protect your business from cyber threats and other emerging exposures, please contact us at any time:

 

Chris Prowse

Senior Client Executive ‑ Corporate Insurance & Risk Solutions

chris.prowse@honan.com.au

0491 696 380

 

Construction in Decline: Insurance Implications for Industry

Construction

For the first time since 2017, the global construction industry outlook has shifted into decline in the wake of COVID-19.  National construction activity is following a similar trajectory, after a 3% decline in December 2019, and a drop of 0.7% in the June 2020 quarter. Fortunately, the Federal Government’s Jobkeeper and Jobseeker programs have assisted many employers in retaining workers and sustaining business operations, as has the classification of construction as an essential service.

 

As we enter Q2 of FY21, we’ve summarised how the present conditions are impacting the insurance market for members of the construction industry.

 

Contract Works – Material Damage
  • Many local insurers have been reviewing their rating models, with knock-on effects to premiums and deductibles. In addition, many have reduced capacity to insure – i.e. where we would normally expect an insurer to insure a risk / builder / project to the value of $100,000,000, we’re now seeing many revert back to a multi-insurer approach, whereby several companies share the risk.
  • Insurers are also closely reviewing the Limits of Liability and sub-limits due to meaningful absences of local capacity.

We believe the above has been brought about by last summer’s unprecedented bushfire season, and the North QLD floods of 2019. Both events have resulted in depleted pools of reinsurance, often making insurance unprofitable for carriers. This is commonly referred to as insurers’ realisation of losses.

  • Previously available coverage enhancements such as Design Exclusion write-backs (LEG3 or DE5) are either seeing a minimum of 30-40% rating increases or scaled back to DE4 reduced coverage, or not offered at all. Following this, we are seeing a large adjustment in DE5 deductibles where insurers would previously have offered coverage and deductibles at a minimum of $100,000. This has been lifted to $150,000-$250,000 due to the breadth of coverage it provides and the complex nature of attritional losses.
  • Contractors with poor loss history and exposure to weather events are experiencing imposed revised deductibles for separate major perils and water damage excesses.

The Lloyd’s of London market has continued to experience change following the Lloyd’s Review
(DECILE 10) and the exit of many construction insurers – where previously they were also providing support to Australian underwriting agencies. Those which remain are increasing minimum rates, securing policy limits and offering higher deductibles.

 

Early engagement is key to insurance success

Insurers, brokers and contractors must work together in the short to medium term, with early engagement critical to help protect each contractor’s capital position/s and future plans for growth. Working together in a tripartite partnership capacity is essential to avoiding bill shock.

 

Construction Liability & Completed Operations

The current situation has seen insurers continue to closely scrutinise their underwriting results across all classes of casualty programs. Insurers have set their sights on underwriting profitability (vs gross written premium) and the investment income is being treated as a ‘nice to have’ and relegated as a priority. We have observed similar responses from insurers based in Singapore as well as Lloyd’s of London. Consequently, we are seeing sharp increases in policy excesses and renewal rates on prior years.

Greater insurer scrutiny and changes to the classification of business that should be written has influenced the costs and restrictions imposed by reinsurance arrangements, meaning:

  • Insurers are seeking to increase rates where claims have been poor or where currently underpriced, or looking to scale back offered policy limits. The increase is between 10-25% on well performing accounts.
  • Insurers are requesting much more information around operations to ensure they fully understand the risks and exposures and price accordingly.  If information cannot be obtained or is ignored by contractors, insurers are likely to restrict coverage or exclude certain parts altogether.

 

Work on bridges, piers, jetties, harbours, defence, civil contractors/earthmoving, and heavy industry are currently considered more susceptible to “long-tail” losses. Insurers are steering away from these risks, which are seen as unprofitable (due to WorkCover recoveries).

Sub-contractor injury or sub-contractor caused property damage deductibles are likely to continue increasing to minimum levels of $50,000 with some seeking up to $250,000 (depending on the industry). Insurers are being selective and treating each risk on their own merits. Options are available for excess buy-down on a standalone product.

An increase to the policy excess can alleviate premium increases. In some events however, the premium reductions are not proportionate to the increase in excess.

 

Worker to Worker claims continue to be the focus of Construction Liability underwriters

Now more than ever, contractor personal injury claims are being brought on by recovery actions from WorkCover and state-based workers compensation insurers (given the long-tail nature and statute of limitations, which can be up to 7 years). As a result, Worker to Worker deductibles offered by insurers and/or cover is being offered at a minimum deductible level of $50,000 and we are seeing insurers requesting claims data for up to 10 years to analyse trends before writing new business.

 

 

We’re With You All The Way

It’s important to be aware of these changes and how they are impacting new and existing insurance policies. As a general rule, it’s best to engage with your broker early to limit bill shock and seek the most appropriate cover for your needs. We encourage you to contact your Honan insurance advisor to discuss your situation and address any questions or concerns.

 

Adam Richardson 

Head of Client Service (QLD) – Corporate Insurance & Risk Solutions

adam.richardson@honan.com.au

 

Honan launches New Extended Mechanical Warranty Policy

Agriculture

Working with Plant & Equipment (P&E) partner, Heavy Machinery Warranty, and underwritten by Lloyds of London, the policy is a new introduction to the Australian market.

Unlike alternative P&E warranty options on the market which typically require machinery dealers to offer indemnity and then seek recovery from the insurance product, the new Extended Mechanical Warranty places policy ownership in the hands of the insured party. Bypassing the need for manufacturer and/or supplier assessments, policy holders (machinery owners) can claim directly against their policy, rather than relying on dealerships to facilitate claims on their behalf.

The cover offered under the policy includes the replacement of parts and/or repair costs to the hydraulics and powertrain following sudden and unforeseen loss. The policy is also available for makes and models of the following types of equipment:

 

Construction Equipment

  • Excavators
  • Bull dozers
  • Wheel loaders
  • Motor graders
  • Articulated trucks
  • Rollers

Agricultural Equipment

  • Tractors

Material Handling Equipment

  • Telehandlers
  • Forklifts

 

We’re with you all the way

For further information on the Heavy Machinery Warranty Policy, please contact Scott Cole at any time.

Scott Cole

scott.cole@honan.com.au

+61 447 566 008

The Cost of COVID: A Note on Personal Health – Do Not Delay!

Medical & Health

Whilst COVID-19 continues to command considerable presence in daily media and our everyday lives, the concerning longer term implications of postponed treatment plans (such as radiology and/or chemotherapy) and delays in diagnostics is being flagged by medical specialists across the world. This is especially the case in Victoria, where Stage 4 restrictions have seen patients commencing new or pre-planned treatments decline significantly. 

Delays in surgery and regular check-ups have also become a concern. A recent study by the Institute of Cancer Research (UK) investigated the impact of three and six month delays to cancer surgery on patients’ five-year survival rates.  The results were staggering.  As an example, modelling revealed a three-month delay across all 94,912 patients who would otherwise have had their cancers removed over the year, would result in an additional 4,755 deaths. These findings certainly have the potential to be extrapolated to other populations like ours here in Australia. 

Taking into consideration a 2020 forecast of 145,000 new cancer diagnoses in Australia – the majority of those being breast or prostate – the window between initial diagnosis to treatment is critical to patient remission rates. From 2012-2016, the 5-year relative survival rate for all cancers combined was 69%. Every month a cancer goes undetected not only lowers the rate of host survival, but adds further strain to the health system down the track. Generally speaking, the later the diagnosis, the longer, or more intense, the treatment plan is likely to be.

Understandably, the greatest volume of information around COVID-19 thus far has been about the Virus itself, but as a community, we must also consider the considerable knock-on effects for patients, practitioners and our health system over the years ahead. A wave of delayed treatments now will result in a wave of implications later … and certainly not pleasant ones. 

There has already been some great investigative journalism carried out by the likes of SBS around what needs to change now, and how we can start planning for a smarter future health system. For those keen to dig in, Surviving the Virus: My Brother and Me is well worth a watch. 

In parallel, there is equal concern around the long-term health prospects of COVID-19 survivors. Ongoing symptoms akin to stroke and cardiovascular problems have already been documented. At the time of publication, we’ve had nearly 27,000 diagnosed COVID-19 cases, with over 24,000 ‘recoveries’ in Australia. These are substantial numbers, and ones we’ll need to take seriously as assess our health sector’s capacity to cope. 

Short term thinking is not the answer here. While the economic impacts are perhaps easier to identify and document in the here and now, personal impacts over the years ahead are unclear, and could certainly be much worse. Just as we’re witnessing mental health ailments at unprecedented levels, delayed diagnostics are following suit. And at what cost?

The conversation, I believe, needs to shift to post-pandemic matters. In Australia, we’re in a privileged position. We have some of the world’s best doctors, nurses, hospitals, and medical infrastructure. We must review how our health system has performed, and what we need to change or start doing to ensure we’re truly future-fit. A group of Victorian Doctors are agitating for such consideration; writing an open letter to Daniel Andrews with numerous powerful points. While the true cost of COVID-19 is impossible to calculate right now, the more we can urge each other to avoid delays to personal treatments and act on our health ailments now – lockdown restrictions permitting – the better.          

 

We’re With You All The Way

 

Trent Woodward  

Head of Health & Medical 

trent.woodward@honan.com.au

Challenge, Community & Opportunity: Could Covid be the reset we needed?

Medical & Health

I recently read a fascinating article by McKinsey about how prioritising health could rebuild the economy post-pandemic. Like any disaster, the rebuild brings opportunity alongside hardship. How we learn from such times of challenge not only builds our resilience, but also knowledge. Whilst Covid-19 has undoubtedly wreaked havoc on individuals and businesses across the globe, it has equally provoked exceptional developments. At breakneck speed, we’ve reshaped ourselves. Personally and professionally, we’ve become enlightened on how to do things differently, and better, in the future.

The past few months have taught us a lot. As a country, we are stronger for the experience and will be stronger in future. We’re focusing more on community; protecting our individual health, but also being mindful of the health of those around us. 

More than ever, we know a collective approach isn’t just better, but the only way forward. Businesses have zoned in on resilience-building capabilities; understanding healthy people and teams must come before profit. With a market-wide approach to prioritising the employee, economies now have the potential to reshape and recover stronger than ever. 

This virus has also challenged our approach to care, particularly for those most vulnerable, or typically marginalised. As the data continues to highlight, high-risk groups like the elderly, those with pre-existing conditions such as obesity, high blood pressure, and diabetes, or within low-income households, are disproportionately impacted by Covid-19. The #BlackLivesMatter movement has further exposed deeply rooted social disparities which continue to exist the world over – glaring gaps inherent in ‘developed’ nations who should, by now, be far further evolved.  

How we learn and grow from here is critical. While we all face uncertain futures, and we know this is even more apparent for minorities. A greater focus on the health of people regardless of race, religion or economic standing will provide greater tolerances in the future. With younger generations watching how we lead through this – here’s hoping we’ll gift them a future marked by a truly people, community and health-focused way of life.  

As we rally for the second half of 2020, let’s not let this virus infect our spirit. Instead, let’s take heart from the exponential learnings, progress and innovations already achieved. In the local health sector we’re already reaping the rewards of a rapid TeleHealth and digital prescriptions rollout, and patient management systems have been transformed by the integration of data analytics. Hospital workforces are now better equipped to cope through peak periods than ever before. Open access to live data and case tracing has been a huge advantage for us here in Australia, helping us to isolate cases as quickly as possible. Longer term, the surge in research and med-tech funding across 2020 is set to deliver incredible returns.

As a nation, I’m looking forward to seeing how we seize the many opportunities brought about by this wild virus. If we’re truly prepared to work together, to care for all members of society through a community-wide approach, our health, wellbeing and economy will enjoy worthy returns for years to come.

 

Trent Woodward – Head of Health & Medical

Corporate Insurance & Risk Solutions

trent.woodward@honan.com.au

Exclusive Global Partnership to Supercharge Honan’s Tech Insurance Offering

Biotech & Life Science

In a world where robust technology and cyber security are more essential than ever, we’re pleased to announce a powerful new partnership with TechAssure. A global leader in its field, TechAssure is an invitation-only international network of independent insurance brokers specialising in technology. Already live, Honan’s Dan McCallum shares how this critical partnership came about, and what benefits are in store for clients.

 

The ideation of Honan’s partnership with TechAssure commenced when?

Across the last 12 months, a number of technology insurance carriers and overseas brokers have recommended Honan to the TechAssure network.

 

What’s the core value proposition of this new partnership? 

The TechAssure network aims to have a presence in each technology hub around the world, giving clients access to the largest network of specialist technology brokers in the insurance industry.

 

What makes TechAssure so special?

To ensure each member of the global TechAssure network contributes valuable expertise to the greater group, they must meet a strict set of criteria (e.g. a minimum level of technology premiums, capability statements and service reports are also vetted). We’re in good company!

 

What benefits can Honan clients expect to enjoy from this new partnership? 

Our clients gain immediate access to market-leading industry insights and tools, including comparative data (e.g. insurance limits purchased by competitors), claims scenarios and claims trends. TechAsssure Brokers also gain access to pre-agreed policy endorsements, which provide their clients with enhanced levels of cover. Honan clients will also have tools on hand to support cyber loss calculations, pre-loss coaching, post-loss coaching and regulatory requirements for other countries (e.g. the General Data Protection Regulation in Europe).

Thanks to timely, industry-leading intel from TechAssure experts across the globe, Honan clients expanding overseas will be equipped with sharper insights than ever before.

 

What kinds of businesses are currently turning to Honan for their tech, cyber &/or digital risk protection needs?

Tech companies across the globe are now turning their attention to Australia as a stable environment to launch new ventures. We’re working with a number of companies in the technology space who are either raising capital through either an ASX listing or seed investment. Honan is being called on by such tech leaders to ensure their assets, people, investors and operations are protected through these exciting new chapters.

 

Where can we go to learn more about TechAssure?

Check out the TechAssure website.

 

Your #1 go-to resource for the latest on all things cyber & tech?

For excellent tech insights and resources across a broad range of industries, check out Kroll.

 

We’re With You All The Way

Please feel free to contact Dan at any time on dan.mccallum@honan.com.au , +61 499 799 131 or connect with him on LinkedIn.

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