International travel and risk mitigation

Recording date: 9/21/23 
Air date: 10/04/23

It’s time to address staying safe, staying productive and staying ahead of the potential risks as business travel has turned the corner to return to the pre-pandemic way of meeting with customers. Zurich North America’s Marty Banaszek, Head of Group Accident, and Andy Zoller, Head of International Programs, discuss the new innovative approach that companies are implementing to stay within their carbon footprint and reevaluating risk management to ensure their employee’s safety while traveling for business.

Guests:

Marty Banaszek
Head of Group Accident
Zurich North America

Marty Banaszek is Head of Group Accident, one of the five businesses in the Life, Accident & Health business unit of Zurich North America in the U.S. Marty and his team are responsible for the distribution, underwriting and delivery of a suite of Group Accident and Travel products for employers and their employees; educational institutions and their students, faculty, staff and employees; and other types of organizations and their participants or members. These products help protect these parties against the financial consequences of accidental death, catastrophic accidental injury, accident medical expenses, hospitalization and defined critical illnesses. These offerings also address a variety of travel risks, including emergency medical events, security threats and travel inconveniences while traveling abroad. Marty is a 25-year industry veteran and has been with Zurich North America for the past 15 years, leading Group Accident for the vast majority of that tenure. Prior to joining Zurich North America, Marty spent time at Chubb and CNA.

Andy Zoller
Head of International Programs, U.S. Commercial Insurance
Zurich North America

Andy Zoller is the Head of International Programs for Zurich North America in the U.S., responsible for the company’s overall international value proposition and go-to-market strategy. Previously, Andy was the Area Executive in Zurich North America’s South Central Area and Director of International Programs for Zurich's Midwest and West regions. Since joining Zurich in 2009, he established the Commercial Markets International Underwriting practice in the U.S., where he led product development, created department guidelines, designed underwriting and marketing tools and implemented several strategic business plans for multiple regions. Prior to joining Zurich, Andy held various underwriting positions with Chubb and was a Commercial Account Executive with American Heritage Insurance Agency, Inc.

Host:

David Hilgen
Editorial Content Manager
Zurich North America

David is Editorial Content Manager for Zurich North America, working primarily with the company’s brand journalism site, Future of Risk. In addition to co-hosting the Future of Risk podcast, he works on external communications in support of Zurich’s sustainability efforts, manages media interactions with Zurich spokespeople and writes articles and thought leadership pieces.

Episode transcript:

DAVID HILGEN: Travel is back! You only have to spend some time inside a bustling and sometimes overcrowded airport to see that traveling has fully rebounded since the World Health Organization announced the end of COVID-19 as a public health emergency. Leisure travel returned first as families were eager to explore the world again after two years of years of being cooped up at home. Business travel is also on the rise and is expected to fully return to pre- pandemic levels by the end of 2024. Of course, travel today is different than it was a few years ago. With this change comes new risks and new ways of mitigating those risks. Welcome to Future of Risk, presented by Zurich North America. I'm David Hilgen. Our guests today will be sharing their insights on what business travelers and their employers can expect, particularly with international trips. Andy Zoller is Head of International Programs for Zurich North America, and Marty Bakaszek is Head of Group Accident at Zurich. Andy and Marty, welcome to the podcast.

ANDY ZOLLER: Thank you, David. Appreciate the time today.

MARTY BANASZEK: Thanks, David. Looking forward to our time together.

HILGEN: Andy, before we start talking about international travel risk, tell us a little bit about your role at Zurich.

ZOLLER: As Head of International for Zurich in the U.S., I'm responsible — and my team is responsible — for Zurich's overall international value proposition and our go-to market strategies. I also have a part of my team that's responsible for developing Zurich's approach to Single-Parent Captive business in the U.S. market.

HILGEN: Okay. Marty, your turn. Can you explain how your Group Accident team helps meet the needs of businesses?

BANASZEK: Sure. David, first of all, Group Accident is a little bit of a legacy name that doesn't address really the full breadth of what we do today. And the full breadth of what we do today really involves addressing kind of the accidental death, accidental injury, medical expense, emergency illness, other travel and security type matters; and at times supplemental medical benefits such as critical illness and hospital indemnity, really for the employer-type organization, for educational institutions, as well as other types of organizations that sponsor activities that participants may be involved in, such as a youth sports organization or a volunteer organization. As you can imagine, with that full breadth, there's a lot of moving parts there. And really for each type of group and or type of coverage, there is some nuance into how we help businesses. But in general, what we're really doing is we're helping mitigate and solve for the adverse financial consequences associated with, you know, an accidental death, an injury, an emergency illness, a travel disruption, or some of those other medical type incidents that I mentioned.

HILGEN: Well, that's a lot. I can see why the nomenclature Group Accident doesn't encapsulate all that. I know the business travel is coming back. With easy access to technology that allows people to meet without leaving their homes, why are more businesspeople trying to connect face-to-face?

BANASZEK: You're absolutely right. Business travel is indeed coming back. As a matter of fact, per Statista, a reputable source in the industry, business travel expenditure in 2024 is actually expected to exceed 2019 … so pre-pandemic, if you will. Yeah, there's no doubt that advancements in technology and society have made it easier for us to connect in broader ways than ever before, but the reality is that most businesses are still people businesses, and in-person action interactions are critical to that. While business travel is indeed back, it's not necessarily back though as per [the] prior usual. So, what we're really seeing is an increased emphasis on increasingly purposeful business travel.
For instance, many organizations today have a remote working environment in whole or part. And those people, while they get a lot of benefits of working remotely, there's a need to connect them, as I mentioned this personal interaction concept. According to the U.S. Travel Association, which is another large industry association related to travel of all types, 40% of remote workers are actually being encouraged to travel to engage with coworkers in person.

HILGEN: Okay. That makes sense. Andy, you recently wrote about the changing risk landscape of international travel. How has business travel changed since the pandemic?

ZOLLER: It's actually interesting. It's been a very slow start of business travel coming back, but, it's been consistently picking up over the past 18 months or so. And I think it's always insightful to think about the fact that the World Health Organization only actually declared an end of the pandemic on May 5th of this year. It seems like it's been over for a while, but it actually has not been that long. And from a U.S. perspective, we've definitely been back longer than that, but when you're discussing things from a global perspective, everyone's timelines are truly different.
So, one of the things I can say is that business travel is definitely a lot more expensive than it had been before the pandemic. You know, because of those increased costs, companies are often asking their travel employees to truly maximize the airfare costs by taking longer trips than maybe they did in the past, and possibly staying in less expensive accommodations. With employees trying to squeeze more into each trip, it would stand to reason that the more time you spend doing something and the more activities you're performing during that time, it's naturally increasing your general exposure to risk.
So, we have to consider that in this post-pandemic world, the other factor, that's relatively new is the impact that climate change is having in the boardroom. Companies are discussing more than ever carbon footprints and what their overall carbon emissions are for with traveling employees, and they're looking at things like alternatives to airfare like rail travel. I know we've talked about low-carbon ride sharing that a lot of the apps now will let you see what your carbon footprint is, depending on which rideshare app you're using. And then also, [there’s] the possibility of using electric scooters in big cities, which is a new challenge that's really popped up in the last few years. And so, where that really comes with an additional risk from travel is rail stations themselves are definitely less secure than an airport, right? There's, in most cases, a lot of security in them … the scooters as I mentioned. It's great to go green with scooters when you're traveling around a city, but they can be dangerous if the rider's unfamiliar with a city or if they're inexperienced riding one. We have to factor all those new things in post-pandemic that we probably didn't think about before. So, those are just a couple of things that I think people should be aware of post-pandemic.

HILGEN: Well, that's a good point. I'm pretty sure I would hurt myself on an electric scooter, so I will walk. Marty, my guess is that most people planning a trip don't worry about what can go wrong when traveling except perhaps the headaches of flight delays or cancellations. But there are real risks to consider when leaving the comfort of home for a long trip. What are some of the things travelers need to consider?

BANASZEK: It's interesting, I think what Andy shared is very on point in the sense that not only are there increased exposures, but there are different types of exposures or maybe exposures that already existed that were not top of people's minds. So often, when people think about business travel, they really think about getting on a plane, but it's really much more than that, particularly domestically or even abroad. As Andy mentioned, whether it be rail or other kinds of increasingly sustainable types of mediums and modes.
When you think even about motor vehicle travel, while business travel deaths in general are quite infrequent, the reality is that for decades running in the U.S. — now talking domestically — motor vehicle accidents have been, if not the number one, one of the leading causes of accidental death in the United States.
So, some of the things that people need to be thinking about beyond flight delays and cancellations are those types of situations. Do they have benefits in place for their employees and members and participants of their organizations in the chance of an unintentional death. Beyond that, particularly when we get to international travel … as you can imagine, that opens up a whole other host of things that folks are exposed to. So, what happens when someone is abroad and they have a medical emergency? How do they get help? What if there's a security issue? Andy mentioned some of the security issues in some of the public transportation arenas … maybe not as strong as you would like them to be. Or what about even the simple things like, I'm traveling abroad and I'm not particularly comfortable with where I am, or I lose my passport or I lose my prescription. So, those are many of the other types of risks that people need to be increasingly aware of because they have real impact.

HILGEN: Interesting. Andy, I want to pivot to you. I want to talk less about travel and just about the world in general. It's a very different place than it was just a few years ago. How has it changed and what does that mean for travelers?

ZOLLER: It's interesting. I've been following, for the past several years, the Global Risks Report, which is published at the World Economic Forum annually. And there's one thing in particular that they spotlight as one of the top five risks worldwide, which I think we should be aware of, and that's the erosion of societal cohesion. It's a mouthful. And societal polarization and what this essentially means is that the more polarized our societies become, our togetherness as a society decreases. Which can lead to, over a population, an increased feeling of general insecurity amongst the citizens. This lack of cohesion is really due to a lot of stuff that's been going on the last few years. You know, things like prolonged economic downturn, cost of living and food supply crises, political instability and general rising inflation. So, you say, “What does all that mean for travelers?” Well, as business travelers get back on the road, they're likely to see an increase in crime, possible civil unrest, or protests that occur with no warning. And, in general, experienced travelers may become uneasy in places that were familiar to them pre-pandemic, because these places and their citizens' general outlook on life have changed. And so, all of these things really will have an impact on a traveler's mental health and feelings of unease and insecurity. Corporations — as they're putting people back out there to continue to grow their businesses — they need to keep those things in mind.

HILGEN: Well, thanks for mentioning the Global Risks Report. I read it every year when it comes out in January. It's not a cheery read, but it's important. It's an important document. Marty, business travel is up and the risks rising. We know that; or at least [they’re] evolving. How is the insurance industry responding to help businesses manage the risks?

BANASZEK: I would say there's probably at least three key things going on. Number one would be reinforcing what exists today. We talked a little bit about some misnomers about what constitutes business travel or not. Or, you know, it's more the headline-making things like a death or something catastrophic. But the reality is, as we said, there's many other types of perils that folks can be exposed to, and there are many solutions today that help solve for all of those. So that's number one, right? Number two is, there is at the same time, truly evolution taking place in the way folks travel. We talked a little bit earlier about the fact that as more folks are remote there's a desire and a reason for business travel to get them together. Many organizations and individuals also incorporate some extended leisure travel, or the industry would call it “bleisure travel,” with their business travel. And there's a need to make sure that historic coverages from the insurance market cover those types of things.
And then last but not least, many of the more progressive organizations are also allowing many of their employees to actually work remotely for extended periods of time. This is very different than moving somewhere for a defined project, a.k.a. being an expert or something like this. This is just a perk of working at an organization. It's a win-win for both the organization and the employee or the members of the organization. And so, we need to make sure that insurance coverages address those types of things.
Third, would be the idea that insurance by nature is really kind of a financial risk transfer. But the reality is that for all the things that may be covered under the insurance benefits, often other things [have to] take place to help solve for them, right? So, the third element is really the increasing aspect of services being incorporated in insurance offerings. There's long been travel assistance companies that help with things and if you just connect the dot to what Andy talked about from a mental health perspective, that's another example of where we're seeing more in terms of third-party services relative to addressing the mental health needs of travelers.

HILGEN: I like your point about working anywhere. I've been trying to convince my boss for a while I need to work in Hawaii. It hasn't worked out so far. Andy, what role does technology play in helping businesses keep their employees safe while traveling?

ZOLLER: The good news is that the technology improvements haven’t stopped post-pandemic. The technology improvements keep coming. AI will add another layer onto that, but I would in general say business travelers have more ways to connect now than they ever have, particularly through the use of apps on their phones and the ability to geolocate people globally. A lot of these apps give business travelers not only ways to track themselves and other employees that are traveling within their company, but they also have the ability to push travel warnings to them on a fairly regular basis so they can see what's going on in their surroundings. where they may not have been able to do that in the past. It could be, you know, anything from crimes to natural catastrophes. And so, the access to data for traveling employees is more than ever, and I think it also adds an extra wrinkle. We have to be concerned about privacy [of] employees, especially if as I mentioned earlier, they're taking longer trips. As Marty mentioned with the “bleisure,” sometimes it might be on their own time. And so, we had launched an app from our World Travel Protection team and it allows the individual employees to “ghost” themselves during certain times … meaning that we know generally where those traveling employees are, but it's all within a certain mile radius, not specifically at their individual location. So, it does give them some sense of privacy while they're traveling. But I think it's something we have to continue to think about, specifically around employee privacy as we're looking to the new technology improvements that have come around the last few years.

HILGEN: Yeah. Well, it reminds me of the warnings we all got at RIMS Risk World in Atlanta in May, when there was an active shooter incident on the last day and everybody's phones went off in the middle of a session. We were safe inside the convention center, but it was nice to know what was going on just a few blocks away.

ZOLLER: Absolutely.

HILGEN: I want to thank you. This has been a fascinating conversation. I didn't know businesses and their employees had so many things to think about when it comes to travel. Any final thoughts, Marty?

BANASZEK: You're right. It has been a fascinating conversation. Again, thank you for the opportunity to spend some time with Andy and you here today. I think you're right. There are many things that businesses and their individuals have to think about. It really comes down to a few things for me: number one is that whether it be an employer or an employee or other type of organization that's sponsoring travel for individuals under their behest, they really have a duty to take care of those folks. And so, I think that always needs to be kept top of mind when these organizations are having people out on their behalf. The second thing I would mention, consistent with a lot of what was said today. is that historically, a lot of the focus of insurance products, and even to an extent services, has really been on when something happens. Increasingly, organizations of all types and in insurance arenas of all types, there's greater emphasis on the “before,” right? The education, the preparedness, the prevention. And then the last two things that I would mention would be … is that really understanding where the solutions are that are out there, the breadth of those solutions and really the intersections of them … not only between various insurance elements that could help address need, but also the services we talked about and how they play a vital role.
And then last but not least — I think it would go for really any organization and on one hand seems like a no brainer — but I think that they should really be looking to work with insurance carriers and distribution partners that not only understand these things — in some respects, that's table stakes; that's the expertise that's expected to be brought to the table — but that really takes a consultative approach to meet the individual needs, wants, timing and budgets of those individual organizations.

HILGEN: Andy?

ZOLLER: I don't know if I can add too much more to what my buddy Marty just put out there because that was a really great summary. I think the one last piece I would add is it's going to become more and more important to focus on these things like the duty of care, the travel apps that we talked about, and the preparedness plans with the younger workforce. Because they expect it, right? So, as you're bringing in new talent to organizations, the days of the road warriors, that know what they're doing and driving themselves in the markets very independently, are slowly becoming not “the norm.” And so, you're having a lot of folks coming into your organizations that expect that the company is going to take care of them in all these situations. And you really want to have a robust plan and good technology and partnering with the right partner so that you don't risk the employees potentially going somewhere else because they can feel like they can get more security from one of your competitors. So that's just the last piece I wanted to add in, but Marty really did a great job summarizing all of that.

HILGEN: Okay. Well thanks to both of you for joining us on this Future Risk podcast.

ZOLLER: Thank you, David. Appreciate it.

BANASZEK: Thank you, David.

HILGEN: I'm David Hilgen for Zurich North America.