Perspectives and Insights with Matthew Turack
I recently had the pleasure to video chat with Matthew Turack, Group President – Insurance, to discuss the upcoming challenges and insurance landscape for 2021 and reflect on the learnings from this past year of challenging and unprecedented times.
Q: To recap, what did CAA Insurance do in 2020 to provide relief to CAA Insurance policyholders during the pandemic?
MT: During this past year, people were driving less and staying home, resulting in a decreased exposure on the road. It was clear that the right thing to do was to lower insurance premiums during a time of financial uncertainly for many. Auto claims were down, and people were driving less, and it was only appropriate to look at ways to pass on those savings to policyholders.
As a quick summary, in April of 2020 CAA Insurance applied a 10% discount to both auto and property insurance policies for the full policy term. This benefit is still in place and continues until June 2021. We followed up in May with a further $100 Auto Insurance relief benefit that was automatically applied to all Ontario automobile policies. Wanting to do even more, CAA Insurance provided an additional relief benefit in October by sending a $50 cheque to all active Ontario auto policyholders. To date, CAA Insurance has provided the most financial savings in the industry with approximately 18% relief in premiums, and we remain the only company to provide premium relief for a full policy term.
This was also the perfect time to remind Ontario drivers of CAA MyPace™, our pay as you drive payment plan that provides a way to maintain full coverage on your vehicle but pay less for insurance. CAA MyPace gives drivers the control over auto insurance premiums by providing the freedom to pay only for the distance they need. And, with more people working from home, and vehicles parked in driveways, this is the payment plan to meet the changing needs of drivers.
In Ontario, we also introduced Emergency Travel Medical Insurance with our homeowner policies. This provides coverage for a medical emergency when travelling outside of province for up to 4 days per trip. More importantly, this addition covers emergency virtual medical care, at no extra cost, when travelling within the province.
Q: How did COVID change the insurance landscape in 2020?
MT: The past year and the pandemic has confirmed that flexibility and consumer choice are extremely important. Consumers want products that provide options and can be flexible in time of need. Products need to be available to meet the consumer’s various life stages and provide solutions for those that work from home and drive less.
It has also shown how important it is for insurance companies to pivot and be agile when things change and be flexible to align with what is going on around us.
The pandemic has changed the way we live. Auto risk is lower, people are driving less, and insurance products need to be available for changing behaviours.
With the increase in supply and demand, vehicle and home repairs are taking longer, due to business closures, material shortages and evolving demand. Supply, at times, is diminished and we need to wait for it to be replenished, which can take a toll on customers waiting to settle their claim. We need to ensure we are managing expectations of policyholders to ease their stress and frustration during an already difficult time.
Q: What surprised you most in 2020?
MT: It was all a big surprise. In March when lockdowns began, we thought it would be a month or two of working from home, then back to the office. At the time, we had no idea how long we would be experiencing these changes.
Communities, individuals and organizations all pulled together to support each other and those in need. Companies retooled to meet the changing demands of the environment and began producing much needed PPE products for the front lines. People stayed home and safe and became very creative with how to stay connected with friends and family.
Businesses adopted new products and services to meet the demands of consumers which included curbside pick up and delivery of everyday products.
Brokers have supported customers, being available to answer questions, deal with concerns and do whatever they could to help policyholders save money. They stepped up even more while trying to keep up with all the communication being sent their way from Insurance Companies, vendors, current customers and general inquiries from consumers looking for answers. They worked tirelessly to look at ways for policyholders to find some financial relief when it was most needed.
Q: Did innovation in 2020 keep pace with expectations and, if not, what needs to happen in 2021?
MT: At first glance, 2020 was more about business continuity and ensuring our systems, people, and products were well aligned to meet the changing demands.
Before the pandemic, consumers were looking for products that would complement and adapt to their various life stages. That was very apparent when working from home became a longer-term reality and driving to work regularly was in the distant past.
Customers want choice and control when it comes to insurance products. They increasingly want their premiums to adapt to how they drive, when they drive, where they live, how they live and how they are using both their home and vehicle. They want flexible payment options and control of their premium dollars.
What the past year has shown us is the need to look at ensuring that when working from home, coverage is there to address the increased risk of ID Theft, Cyber Security, Home Equipment Breakdown, and other products or services that can be added to the standard home insurance policy to keep up with the demand of working from home.
Q: How will the pandemic shape our product strategy moving forward?
MT: More effort is needed, and products must be developed that meet the individual needs of consumers. One size does not fit all and that has been apparent for many years.
Prior to launching net new products, look at what is in your arsenal and identify how you can expand on it… For example, we will be looking at CAA MyPace to see how we can make it even better and expand on the current pay as you drive payment plan to reach many more drivers.
Stay tuned for part two of this interview...