Changes in BOP Inquiries VS. Other Lines of Coverage During the Pandemic
The impact of pandemic-related shutdowns on the Bold Penguin exchange
COVID-19 is causing big changes around the world, and the commercial insurance industry is no exception. State mandated stay at home orders and strong pressures to social distance forced many businesses to shut down, either temporarily or permanently, and have resulted in a spike in unemployment rates across the country. This has forced many small business owners to put their dreams of opening – and insuring – that new business venture on hold. From March 8 to March 29, the weekly number of initial unemployment claims around the country increased from roughly 250,000 to more than 6.2 million before beginning to decline in April 2020. (source: United States Department of Labor statistics).
The Bold Penguin Exchange has also experienced the direct effects of these staggering unemployment figures. The average number of weekly quote starts within Bold Penguin’s ecosystem from small business owners around the country was down 17% in mid-March when unemployment claims first spiked. As of June 10 it has bounced back fully and is now showing growth rates well above those seen pre-COVID.
Not only has COVID-19 affected the number of business owners shopping for commercial insurance, it has also produced a change in shopping behavior. Possibly the most extreme change seen in the Exchange has been the surge in requests for business owner’s policies (BOPs), which can be used as protection in the event of business interruption. Since mid-February, the mix of small business owners (SMBs) searching for a BOP quote that have been helped by the Bold Penguin Exchange has increased from 10% to 30%. In other words, now 3 in 10 SMBs are looking for BOP insurance versus 1 in 10. The data shows that business owners have been scrambling to protect their businesses from the strained economic effects of COVID-19, and they are turning to Bold Penguin for help.
The mix of business classes supported by the Bold Penguin Exchange has also shifted since the emergence of COVID-19 and increase in unemployment. Since March 15, the ratio of small business owners coming into the Exchange has increased significantly for truck transportation (+3.5%), landscape services (+2%) and courier/messenger services (+1%), while the ratio has decreased for others such as ride sharing/taxis (-1%) and amusement industries (-1%). These behaviors reflect what is to be expected in this crisis – companies that help those directly affected by COVID-19 or that require little human contact are on the rise while recreational services are trending down in light of social distancing.
The commercial insurance industry, along with virtually every other market, has been hit by COVID-19. The changes we are experiencing in our exchange are reflective of the industry overall which is evolving at a rapid pace. Agencies and insurance carriers have transformed virtually overnight to continue to serve small businesses across the United States. We’re proud to partner with the industry, empowering their operations as they empower the small businesses that have faced countless challenges in the face of the pandemic. We are stronger together and look forward to continuing to help the commercial insurance industry adapt to the evolving trends and customer needs.