The new impairment model, with its paradigm change from allowances based on incurred losses to risk provisions based on expected losses, will have a huge impact on financial reports of banks and their analysis. It can be expected to lead to considerably increased impairments at initial application, and over time to a higher degree of volatility.
Insurers are exposed to the effects of a pandemic through a number of business lines, including such risks as business interruption, health, disability, medical malpractice, workers’ compensation, and life insurance. Estimates of the impact of a global flu pandemic on the insurance industry vary widely.