The Reinsurance Group of America (RGA) is encouraging the industry’s stakeholders to examine the results of the COVID-19 pandemic for insight into the next possible pandemic, and to look back even further for valuable insights into the mortality and morbidity outcomes of pandemics.
“Four years on from COVID-19, life insurers have a key opportunity to assess the accuracy of their risk models and gather lessons from centuries of data to better prepare for the next global pandemic,” they write in a recent note, Managing Pandemic Risk After COVID-19: Lessons from the past, preparing for the future. “The COVID-19 pandemic presented a unique opportunity: It allowed life insurers to evaluate how well they anticipated the effects of a global pandemic and study COVID’s actual impact to adjust their modelling for future pandemics.”
They add that numerous factors affect the spread and penetration of diseases across global populations. “By isolating these factors and studying them in combination, life insurers can better prepare for future disease outbreaks,” they write.
The report looks at what a pandemic is, explains spark risk, spread risk and examines risk drivers. It also includes a discussion about the origins of zoonoses – diseases that move from humans to animals: “It should be noted that zoonoses are not well adapted to infect humans. They typically spill over to people in random incidents, sometimes resulting in small, contained outbreaks referred to as stuttering chains. These instances of intermittent virus transmission, or viral chatter, raise the threat of a pandemic because they give viruses opportunities to evolve and more effectively spread among humans.”
The paper, which cites research looking at more than 400 years of records to identify 185 pandemics globally which caused significant loss of human life, also points to the 1918 Spanish flu as an example to study, saying nearly every other pandemic on record is dwarfed by that pandemic’s devastation. They add that today’s world is better equipped to respond to an influenza pandemic – models estimate that nearly 70 per cent fewer deaths would result from the event had it occurred 100 years later. Regarding the COVID-19 pandemic, the paper also cites research which says the pandemic clearly levied unequal effects on the mortality rates in insured lives versus the general population, with significant differences by age.
In a discussion about the global variation in institutional readiness to detect and respond to a large-scale outbreak of infectious disease, meanwhile, they note that poorly prepared countries may suffer from political instability, weak public administration, inadequate resources for public health and gaps in fundamental outbreak detection and response systems.
The paper wraps up by encouraging insurers to estimate the frequency and severity of future pandemics saying the exercises are essential for assessing risk, as most researchers believe pandemics will occur more frequently in the future.
