Lloyd's highlights importance of insurance to safeguard employee value
Source: Middle East Insurance Review | Jun 2021
A new report published by Lloyd’s in collaboration with KPMG looks at how human capital, or the collective abilities and skills of employees, is an important driver of organisational value and a potential blind spot for firms failing to invest in their workforce in the wake of the pandemic.
The new report, ‘Safeguarding human capital: How to protect and enhance the value of human capital’ published in May 2021 is the last of a series of joint reports from Lloyd’s and KPMG which focus on the increasing risk intangible assets pose to organisations and the importance of protecting them.
The report identifies ways in which the insurance industry could help organisations to manage and mitigate against the varying and far-reaching implications of human capital events, such as a pandemic.
While there are existing insurance solutions already available in the Lloyd’s market, the report highlights the need for a further continued effort at product development in this area. By protecting the value associated with teams rather than just key individuals, human capital insurance solutions could be vital for workforce management in the wake of the pandemic and future systemic risks.
The report focuses on how insurers can support organisations following an adverse event by not only addressing the wider damage caused, but also by playing a preventative role. As well as considering how different metrics and indices can be used to quantify and measure the damage of human capital events, insurers could track and analyse workforce data to project risk triggers and their potential impact on value.
COVID-19 has exacerbated many of the risks involving human capital value. With the pandemic impacting the entire workforce globally, and many organisations still operating under a remote working model, the value of employees in achieving productivity is vital for business continuity. It is becoming increasingly apparent that talent attraction and retention, and employee wellbeing are not just intrinsically linked, they also have a direct impact on business performance. M