Pandemic expected to wreak havoc on top insurance brands
The world’s top 100 most valuable insurance brands could lose up to US$100 billion worth of brand value as a result of the COVID-19 pandemic, according to the Brand Finance Insurance 100 2020 report.
Brand Finance’s analysis shows that the insurance sector is one of the most heavily impacted industries globally and could face a potential 20 percent loss in brand value as a result of the coronavirus outbreak.
The pandemic is set to wreak havoc on the sector in the coming year both financially, as brands that already operate on wafer-thin margins are being drowned in claims, and reputationally, as brands which refuse to pay out COVID-19 related claims are risking potential irreparable damage, the report finds.
“The COVID-19 pandemic is going to hit the insurance sector hard,” said David Haigh, CEO of Brand Finance.
“Undoubtedly, we are going to witness revenue slowdown for all brands across the sector. Some brands should, however, fare better in terms of their margins, including property and casualty insurance brands, as fewer such claims are expected during the far-reaching and ongoing lockdown period,” he added.
With a total brand value reaching US$151.5 billion, China is home to the most valuable insurance brands in the world. Ping An leads the way for the further 11 Chinese insurance brands that feature in this year’s ranking.
The Shenzhen-based company has recorded an impressive 20 percent brand value growth to US$60.6 billion, extending its lead further as the world’s most valuable insurance brand.
Five Chinese brands feature in the top 10: Ping An; China Life (down 10 percent to US$23.6 billion); AIA (up 17 percent to US$18.2 billion); CPIC (up 31 percent to US$14.0 billion) and PICC (up 20 percent to US$11.0 billion).
Their combined brand value equates to over 80 percent of the total Chinese brand value in the ranking.
Competition between the top five remains fierce and it is unlikely that smaller Chinese brands will be able to compete with them in the near future, according to the report.
With a brand value growth of 31 percent to US$14.0 billion and a Brand Strength Index score increase from 68 to 78 out of 100, Shanghai-based CPIC is the fastest-growing brand in the top 10 by brand value and brand strength.