WEBINAR: COVID-19 AND REOPENING THE ECONOMYMay 20th, 2020Please note that this session was held at a particular point in time (Wednesday May 20th, 2020, 4pm-5pm EDT), and in light of the rapidly evolving COVID-19 situation, it is possible these discussions are no longer accurate after that date.

CONFIDENTIALITYOur clients’ industries are extremely competitive, and the maintenance of confidentiality with respect to our clients’ plans and data is critical. Oliver Wyman rigorously applies internal confidentiality practices to protect the confidentiality of all client information.

Similarly, our industry is very competitive. We view our approaches and insights as proprietary and therefore look to our clients to protect our interests in our proposals, presentations, methodologies, and analytical techniques. Under no circumstances should this material be shared with any third party without the prior written consent of Oliver Wyman.

© Oliver Wyman

3© Oliver Wyman

WEBINAR AGENDA

01 Epidemiological update

02 Macroeconomic outlook

03 Fireside chat: Implications of the reopen

04 Q&A

4© Oliver Wyman

OUR HOST

OUR PANELISTS

Til SchuermannPartner & Co-Head –Risk & Public Policy

Helen LeisPartner, Health & Life Sciences

Mick MoloneyPartner & Co-Head Global Insurance

EPIDEMIOLOGICAL UPDATE

01Helen LeisPartner, Health & Life Sciences

6© Oliver Wyman

COVID-19 SPREAD GLOBALLY

80k

Information as of 5/19/20

As of May 19th, 2020• ~4.9 MM cases reported

in 200 countries and territories• ~322 K reported deaths

First reported in Wuhan,China, on December 31, 2019

Declared a global pandemicby the World Heath Organizationon March 11, 2020

1. Countries included: All Countries in “European Region” Sub-region in WHO Situation ReportSource: Map from CDC (link), Numbers from John Hopkins University & Medicine (link)

7© Oliver Wyman

AT A GLANCE: SUMMARY FACTSInformation as of 5/14/20

Key facts ImplicationsContagion • Initial estimates suggested COVID-19 R0 is between 2 and 3 (with edge of range

estimates closer to 1.4 and 3.6), which means each person infects 2–3 others2; R0 for the seasonal flu is around 1.33

• New emerging estimates suggest R0 may be closer to 5.7 (edge of range 3.8–8.9)4

Without masks, social distancing, and selective isolation, COVID-19 is at least twice as contagious as the seasonal flu

Current human immunity

• No herd immunity exists yet as the virus is novel in humans Social distancing (quarantines, WFH, school closures) was the only “brake” to slow spread

Incubation period • The incubation period is a median of 5.5 days (up to 14 days)1,15 (vs 3-day period for common flu1); data suggests that viral shedding continues beyond symptom resolution5

People are contagious for longer periods than the flu or other illnesses, requiring longer bouts of quarantine to suppress spread

Portion of cases asymptomatic but contagious

• COVID-19 can be spread asymptomatically6

• In retrospective studies of those people tested and confirmed positive for COVID-19, experts estimate 18–30% are asymptomatic, with another 10–20% with mild enough symptoms to not suspect COVID-197

• Early indicators from point in time comprehensive testing of small populations (e.g., Vo, Italy; Iceland) suggest as many as 50% of cases could be asymptomatic8

• In cohorts of younger individuals (e.g., pregnant woman, sailors on USS Theodore) the proportion of asymptomatics exceeded 60%9,10

People who feel “fine” are capable of –and are – transmitting COVID-19 to others

Portion of cases reaching “critical”/ “severe” infection

• Approximately 19% of confirmed cases are considered “severe” or “critical”, requiring hospitalization; 1/4th of those need ICU beds11

Hospital systems risk being overtaxed (ICU beds, ventilators, PPE) meaning case fatality rates could rise further

Fatality • Case fatality rates are trending at 6.6% globally12 (vs. 0.1% for flu13)• Estimates for infected fatality rate are 0.3%–1.3% based on assumptions around

the number of undiagnosed individuals14

Fatality is orders of magnitude higher than typical influenzas

1. CDC. 2. The R0 for the coronavirus was estimated by the WHO to be between 1.4–2.5 (end of January estimate) (link), other organizations have estimated an R0 ranging between 2–3 or higher (link); 3. CDC Paper (link); 4. Emerging Infectious Diseases (link) 5. MedRxIv. “Clinical presentation and virologic assessment of hospitalized cases of coronavirus disease 2019 in a travel-associated transmission cluster”. Mar 8. 2020. 6. JAMA. “Presumed Asymptomatic Carrier Transmission of COVID-19” 7. Nature (link), Eurosurveillance Paper (link) 8. ZMEScience report (link) 9. Business Insider (link). 10. NEJM (link) 11. China CDC, JAMA (link). 12. JHU. 13. CDC 14. SARS-CoV2 by the numbers (link) 15. Annals of Internal Medicine (link)

8© Oliver Wyman

Epidemiologic perspectives

• Seasonality: Several new studies released last week (MIT, University of Toronto) suggest impact of seasonality is likely to be very mild and will be insufficient to stamp out pandemic

Suppression and road to reopening

• Testing: FDA has issued 3 EUAs in the past two weeks for new types of tests (CRISPR, Antigen, saliva-based at home collection); likely the tip of the iceberg of a new wave of tests that will come to market carrying the promise of faster and cheaper testing at scale

• Tracing: As countries across the globe move towards re-opening, individual employers are weighing whether they should supplement public health tracing with their own solutions. Tech companies are seizing the potential opportunity and assembling offerings

• Privacy related to tracing will continue to be a hot-button issue; a new bill was introduced both in the House and the Senate to protect privacy in this era of tracing

Re-opening approach and considerations

• ~75% of US states have taken steps to reopen their economies, ranging from very staged and/or regional to comprehensive and spanning their entire footprint; Many European countries, including hard-hit Italy and Spain are on the path to re-opening including several (e.g., Denmark, Austria, Netherlands, France) that have re-opened schools. The European Commission recommended re-opening of borders in time for summer

• New case growth: Re-opened countries are watching case growth very closely and many are implementing measures swiftly (e.g., re-closing of bars in S. Korea, mass testing campaign after 6 new cases in Wuhan, Germany’s announcement of strict criteria for an “emergency brake” which would bring back restrictions)

• Sweden: Sweden continues on its course of aiming to build herd immunity while ensuring that the health system does not become overwhelmed. Sweden’s chief epidemiologist predicts Stockholm could reach herd immunity as early as this month

Vaccines and therapeutics

• Remdesivir: Gilead is rapidly penning partnerships with generics manufacturers to scale up manufacturing and distribute Remdesivir globally. Meanwhile HHS is stepping in to help appropriately allocate available doses to state health departments in the US

• Vaccines: All major manufacturers are rushing to scale up production in preparation for any successful clinical trials; even with pre-scaling of manufacturing, biotech giants are predicting limited availability in fall / winter and mass availability next year

RECENT DEVELOPMENTS

9© Oliver Wyman

55%of Americans say COVID-19 is impacting their mental health1

52% of Americans report concern about job security, and 45% are worried aboutreductions in income 6

33% of respondents indicated frequent feelings of isolation5

20% admitted increases in alcohol consumption5

>50% of respondents reported new musculoskeletal concerns5

50% of respondents reported discontent with current work-life balance5

64% report loss of sleep due to worry5Other Risk Factors

Since the Emergence ofCOVID-19

9XDisaster distress helpline calls at SAMHSA compared to March 20194

24%of Americans indicated thatCOVID-19 has resulted in anincrease in family conflict3

+34%Increase in anti-anxietyprescriptions from mid-February to mid-March2

HOW ARE AMERICANS BEARING UP?

1. Sykes - Americans’ Perceptions of Telehealth in the Era of Covid-19 Program observations, 2. ESI – America’s State of Mind Report, 3. American Psychiatric Association, 4. SAMHSA, 5. Institute for Employment Studies, 6. Kaiser Family Foundation

10© Oliver Wyman

AS GEOGRAPHIES RE-OPEN, WE ARE MONITORING A BROAD ARRAY OF DATA POINTS TO PREDICT REGIONS AT HIGHEST RISK OF FURTHER DISRUPTION

• How hard has the region been hit?

• Where is the region on its first outbreak curve (emerging, stabilizing, recovering)?

• How well have hospitals been able to manage the first surge?

• How broadly and how quickly are businesses being allowed to re-open?

• How stringent are PPE and social distancing requirements?

• Is there sufficient testing capacity to detect patients early?

• Is there sufficient contact tracing capability to identify potential infections early?

• What increased capacity is being planned?

• How are mobility and social distancing indicators changing?

• How is transmission rate increasing?

• Using OW’s boots-on-the-ground Global Sensing Network, how are individuals and businesses behaving and complying?

• Is the region higher-risk due to age, population density, comorbid conditions, socioeconomic factors?

• Is there a cultural bias toward social distancing, or multi-gen households?

Contact tracingSurveillance

Testing % positiveTests per day

Reopening timing, policy, stringency, seq.

PPE/distancing mandateTravel restrictions

Mobility indices (Apple, Google, etc.)

PPE complianceOW transmission rateAnecdotal compliance

New cases trajectoryCase fatality rateCases per capita

Impact on hospitals, PPE, vents, workforce

Age, density, % urbanChronic conditions% essential, % WFH

Household size, x-genTravel exposure

1 2 3 4 5Initial peak experience

Reopeningpolicy

Public health infrastructure

Leadingindicators

Populationdynamics

11© Oliver Wyman

1 2 4 53

WE BELIEVE SOME ARCHETYPES CARRY A HIGHER RISK OF FURTHER DISRUPTION AS WE EMERGE FROM THE FIRST PEAK

Surviving and recovering

Preparing for recovery

Managing the surge Eager Reopening Spared

and reopened

• Dense urban populations severely affected, leading to highest case fatality and cases per capita

• Most have not yet reopened indoor businesses despite declining new cases

• All require face masks in public, and reopening plans are staged and regional

• Major cities remain at risk despite cautious approach to reopening

• Most have not yet reopened indoor businesses, or have reopened very narrowly as they hope to see cases decline

• Preparing for testing and tracing by boosting capabilities

• Reopening policies vary: some reopened broadly, while others are taking regional and/or staged approaches

• New cases continue and oscillate unpredictably, posing the potential to outpace testing

• Most states reopened as new cases were rising – but have since managed to stabilize and decline new cases (except SD)

• Reopening policies vary: some reopened broadly, while others are taking regional and/or staged approaches

• Insufficient testing may be obscuring true case growth

• Least affected by the pandemic to-date

• Most reopened statewide, but those with denser cities are taking a regional approach

• Testing was strong, but is starting to decline, and mobility is rising

• Most have relatively vulnerable populations, and demonstrated less distancing during the first outbreak – leaving them less prepared for one in the future

MACROECONOMIC OUTLOOK

02Til SchuermannPartner & Co-Head –Risk & Public Policy

13© Oliver Wyman

U.S. Real GDP Growth Forecasts – Q1, Q2, Q3, Q4, and annualAnnualized growth rate, by select economic analysts (9) 1,2

Key observations from estimates

• Forecast updates have been frequent and sizable – Consensus is that bad news on the virus continues to outweigh good news on policy actions

• Forecasted Q2 qoq annualized growth rate in the US (~30–40% drop) will be the worst since we have quarterly data available

• Key indicators to track include:– Trend for percent of U.S.

population infected (scenarios ranging up to 80%)3

– Reliance on “smart” mitigation strategies (e.g., mass testing, use of analytics)

Apr 20 – 30May 1 – 15 GDP Actual Nowcast

Q1 2020 Q2 2020 Q3 2020 Q4 2020 2020 (annual)

Median -3.9% -38.9% 21.9% 12.0% -6.3%

Average -5.2% -37.3% 17.2% 12.8% -6.2%

Max/Min -2.3%/-9.9% -30.0%/-41.4% 29.0%/-1.0% 25.0%/5.7% -5.6%/-7.1%

Actuals -4.8%

Q2 Mid-March consensus

Q2 202030

Q1 2020

-50

-30

-40

20

-20

-10

0

2020 (annual)

10

JP Morgan

DB

TD

DB

Moody’s

Goldman CBO

JP Morgan

Nowcast (May 15)

DB

Annu

aliz

ed g

row

th ra

te (%

)

JP MorganCBO

CBO

GoldmanMorgan Stanley

TD

UBSCBO

Morgan StanleyTD

UBS

B of A

Morgan Stanley

TDDB

B of A

Goldman

CBO

DB

GDP Q1 Actual Nowcast (May 1)Goldman

Goldman

Last updated: 5/18/2020

LATEST GDP FORECASTS INDICATE A SEVERE SHOCK IN THE U.S. ECONOMYThe escalation of the Covid-19 crisis has lead to significant downward revisions in GDP forecasts globally

1. Sources: Bank of America (May 8), Moody’s (Apr 28), UBS (Apr 29), Goldman Sachs (May 12), Morgan Stanley (May 15). TD (Apr 20), JP Morgan (May 8), BEA (Apr 29), CBO (Apr 24), DB (May 12), FRBNYNowcast (May 1, May 8, Nowcast not included in table calculations), Q1 estimates based on latest forecast before release of Q1 GDP Actual2. Quarterly estimates in terms of qoq% seasonally adjusted annual rate (saar)3. Imperial College COVID-19 response team

Q3 2020 Q4 2020

14© Oliver Wyman

U.S. Real GDP Growth Q2 Forecasts over timeAnnualized growth rate, by select economic analysts (8) 1,2

Apr 15 – Apr 28Mar 15 – Mar 20 Mar 22 – Apr 2 Apr 29 – May 15

Mid March Late March – Early April Mid – Late April Early May

Median -13.5% -30.0% -36.3% -38.3%

Average -15.8% -28.9% -34.9% -36.3%

Max/Min -12%/-24% -25%/-34% -25.5%/-41.4% -30%/-40%

-10

-45

-25

-20

-5

-40

-35

0

-15

-30

DB

Goldman

GoldmanUBS

Annu

aliz

ed g

row

th ra

te (%

)

JP Morgan

DB

B of A

Goldman JP MorganTD

B of AMorgan Stanley

UBSJP Morgan

DB

TDB of A

JP MorganCBO

UBS

Nowcast (May 15) B of A

DB Morgan Stanley

Last updated: 5/18/2020

1. Sources: Bank of America, UBS, Goldman Sachs, Morgan Stanley, TD, JP Morgan, DB, CBO, FRBNY Nowcast (Nowcast not included in table calculations)2. Quarterly estimates in terms of qoq% seasonally adjusted annual rate (saar)

Late March – Early AprilMid March

• This degree of updating is unprecedented there is just a lot of uncertainty!

• Forecasts have begun to stabilize, showing less downward revisions in the past month

• Expect similar uncertainty for Q3 GDP predictions

Key observations from estimates

Early May

Q2 GDP FORECASTS HAVE BEEN TRENDING DOWNWARDS OVER THE PAST 2 MONTHSThe spread between estimates though has remained relatively constant across each time segment

Mid - Late April

15© Oliver Wyman

U.S. Unemployment Forecasts – Q1, Q2, Q3, and Q4Quarterly unemployment rate, by select economic analysts (5)1

Key insights

• Most annual unemployment forecasts assume a steady economic recovery starting in June, and do not account for the possibility of subsequent significant waves of infection

• 36.5 million unemployment claims filed since start of the COVID-19 lockdown, wiping out the last eleven years of job gains3, 4

• Congressional Budget Office forecasts a slower employment recovery than most major banks

• The CARES Act has allocated ~$660B in forgivable loans to cover small business payroll expenses, padding against additional job losses in the short term

May 8 – 12 ActualsApr 17 – 24

THE DOWNWARD SHOCK TO GDP IS MIRRORED IN UNEMPLOYMENTThe escalation of the Covid-19 crisis has lead to significant bearish revisions unemployment forecasts globally

Peak unemployment during financial crisis2

1. Sources: Goldman Sachs (May 12), TD (Apr 20), Deutsche (May 12), JP Morgan (May 8), CBO (Apr 24)2. Sources: U.S. Bureau of Labor Statistics3. Source: Federal Reserve Bank of St. Louis4. Tracking unemployment forecasts against unemployment reports may be misleading – unemployment reports only record jobless workers actively searching for employment

Last updated: 5/18/2020

Q3 2020 Q4 2020

Q1 2020 Q2 2020 Q3 2020 Q4 2020

Median 3.8% 16.5% 14.0% 11.0%

Average 3.8% 17.8% 14.2% 10.1%

Min/Max 3.8%/3.8% 14.0%/25.0% 9.2%/18.5% 7.1%/12.0%

Actuals2 4.4% (Mar) 14.7% (Apr)

Q2 2020

20

Q1 2020

15

5

10

0

25

CBO

Deutsche

TD JP MorganMarch Actual

Deutsche

TD

JP Morgan

CBO

Deutsche

CBOApril Actual

Goldman

CBO

Goldman

JP Morgan

JP Morgan

Deutsche

TD

Goldman

Une

mpl

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ate

(%)

TD

16© Oliver Wyman

87

91

8889

929394

90

95969798

10099

Q8 (2009 Q4)

(4Q 21)

Q3 (2008 Q3)

(3Q 20)

2020 COVID Crisis consensus1

Q7 (2009 Q3)

(3Q 21)

Q4 (2008 Q4)

(4Q 20)

Q5 (2009 Q1)

(1Q 21)

Start(2007 Q4)

(4Q 19)

Q2 (2008 Q2)

(2Q 20)

Q6 (2009 Q2)

(2Q 21)

CCAR 2020

Financial Crisis

Q1 (2008 Q1)

(1Q 20)

U.S. Real GDP relative to Q4 2019 (100) and compared to CCAR and Financial crisisEstimates as of Apr-201 US GDP Indexed to P0 (CCAR 2020)2 and 4Q07 (Financial Crisis)3

CCAR projected quarterFinancial Crisis quarter2020 COVID Crisis projection

1. Consensus as the average of Goldman Sachs (May 12), JP Morgan (May 8), Morgan Stanley (May 15), CBO (Apr 24),TD (Apr 20), UBS (Apr 29), Deutsche (May 12) forecasts, Bank of America (May 8) Q1 forecasts based on latest estimates before release of Q1 GDP actual2. Source: “CCAR 2020 data release” - Federal Reserve3. Source: Federal Reserve Economic Data

GDP PROJECTIONS ASSUME A RETURN TO PRE-COVID LEVELS BY EARLY 2022We continue observing downward adjustments: as of last week, the expectation was to recover by early 2022

Last updated: 5/18/2020

17© Oliver Wyman

U.S. Unemployment Forecasts compared to CCAR 2020 and Financial CrisisQ1 2020 – Q4 2021

CCAR projected quarterFinancial Crisis quarter2020 COVID Crisis projection

1. Consensus as the average of Goldman Sachs (May 12), JP Morgan (May 8), Deutsche (May 12), TD (Apr 20), CBO (Apr 24) forecasts; consensus for 2020 Q4 – 2021 Q4 does not include CBO estimates2. Source: “CCAR 2020 data release” - Federal Reserve3. Source “Unemployment Rate” – Federal Reserve Bank of St Louis

UNEMPLOYMENT PROJECTIONS ASSUME A RETURN TO PRE-COVID LEVELS BY EARLY 2022

Last updated: 5/18/2020

8%

4%

6%

10%

12%

14%

16%

18%

2%

20%

22%

24%

26%

Q3 (2008 Q3)

(3Q 20)

Q5(2009 Q1)

(1Q 21)

Une

mpl

oym

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ate

Financial Crisis3

Q1 (2008 Q1)

(1Q 20)

Q2 (2008 Q2)

(2Q 20)

Q4(2008 Q4)

(4Q 20)

Q6(2009 Q2)

(2Q 21)

Q7(2009 Q3)

(3Q 21)

Q8(2009 Q4)

(4Q 21)

CCAR 20202

2020 COVID Crisis consensus1

= range of COVID Crisis forecast estimates

18© Oliver Wyman

THE FINANCIAL CRISIS RESULTED IN A LASTING SHIFT IN THE LONG-TERM TREND OF REAL GDP

U.S. Real GDP in log scale1947 – April 2020

Long-term trend lines

Source: Federal Reserve Economic Data

Break in level and slope post 2008

19© Oliver Wyman

LATEST GDP ESTIMATES IN SELECT REGIONSThe escalation of COVID-19 crisis has lead to significant downward revisions in GDP forecasts globally

Consensus 2020 Real GDP Growth Forecasts, Nov 20191 vs May 20202

% growth YoY, median

2.9%2.0% 1.6% 1.0% 1.0% 0.4%

5.7%

-1.1%

-5.5%

-3.3% -3.9% -4.5% -4.2%

1.5%

-3.2%

-6.4%-6.1%

-7.7% -7.6%-6.1%

1.3%

-10%

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

Global US Canada U.K. Euro Germany China

2020 est. (in Nov 2019) 2020 est. (~early April 2020) 2020 est. (~early May 2020)

Last updated: 5/18/2020

1 Source: OECD.2. Sources, date of latest update: Bank of America (May 8), Moody’s (Apr 28), UBS (Apr 29), Goldman Sachs (May 6), Morgan Stanley (May 8), Deutsche (May 12), JP Morgan (May 8). GDP growth forecasts obtained as the median of estimates.3. Q1 GDP results in terms of qoq annualized rates4. Estimate from novel ‘flash estimate’ measure from Statistics Canada

2020 Q1 GDP3 -4.8% -10.0%4 -7.7% -14.2% -8.6% -34.7%

20© Oliver Wyman

THERE ARE SEVERAL POTENTIAL PATTERNS FOR ECONOMIC RECOVERY

Time

GDP

V-shaped recovery

Economy recovers relatively quickly

Time

GDP

Time

GDP

W-shaped recovery

Economy ‘re-opened’ too quickly

Increase in cases causes GDP to suffer

Swoosh-shaped recovery

Recovery slower than V-shape, but

faster than U-shape

Time

GDP

U-shaped recovery

Economy recovers slower than V-shape

Time

GDP

L-shaped recovery

Economy never fully recovers

21© Oliver Wyman

BREAKEVEN INFLATION RATES HAVE FALLEN BUT REMAIN ABOVE LEVELS REACHED DURING THE FINANCIAL CRISIS

10-Year & 5-Year Breakeven Inflation Rates2005 – May 15th 2020

Jan/05 Oct/13Apr/06 Jul/12Oct/08Jul/07 Jan/10 Apr/11 Jan/20Jan/15

2.0

1.0

Apr/16 Jul/17 Oct/18

0.0

-1.0

Apr/21

-2.0

3.0

-2.5

-1.5

-0.5

0.5

1.5

2.5

-2.12%

0.73%

0.12%

1.12%

10-Year Breakeven Inflation Rate5-Year Breakeven Inflation Rate

Source: Federal Reserve Economic Data

22© Oliver Wyman

FORECASTS OF FUTURE INFLATION ARE LOW BUT ABOVE DEFLATIONARY LEVELS

Q1 2020 Q2 2020 Q3 2020 Q4 2020 2020 (annual)

Median 2.1% 0.1% 0.3% 0% 0.7%

Actuals 2.1% 0.3% (April)

U.S. CPI Forecasts – Q1, Q2, Q3, Q4 and annualCPI %YoY, by select economic analysts (5)1

Deflation Inflation between 0 & 1.5% Inflation between 1.5 & 2.5%

3.9% 78.5% 17.1%

U.S. PCE Probability estimations, as of April 2020 Probability of PCE over next 12 moths falling below 0 or staying within the identified range, by FRB St. Louis2

1. Sources: Bank of America (May 8), UBS (Apr 29), Goldman Sachs (May 12), Morgan Stanley (May 8), Deutsche (May 12), JP Morgan (May 8). 2. Federal Reserve Economic Data3. FRB St. Louis (Apr 9), Financial Times (Apr 28)

Quotes from select economic analysts3

• “In the short term, though, the negative demand shock (a possible deep recession) combined with the collapse in crude oil prices will likely result in an economy-wide disinflationary shock that could last for several months.” –Economic Research at FRB St. Louis

• “Longer-term market gauges show investors do not expect the extraordinary rescue measures undertaken by the US central bank and the federal government are likely to trigger a surge in consumer prices” – Financial Times

FIRESIDE CHAT:IMPLICATIONS OF THE REOPENModerated by

03 OUR PANELISTS

Helen LeisPartner, Health & Life Sciences

Mick MoloneyPartner & Co-Head Global Insurance

Til SchuermannPartner & Co-Head –Risk & Public Policy

24© Oliver Wyman

WHAT ABOUT HERD IMMUNITY – CAN THAT HELP?Herd immunity is a long way off

Total infected (detected and undetected) / Total populationSelected countries as of May 19

0%

10%

20%

30%

40%

50%

60%

Swed

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ance

Iran

Mex

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Cana

daSw

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land

Port

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Pana

ma

Qat

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Denm

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Germ

any

Rom

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Chile

Russ

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stria

Finl

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rael

Colo

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Serb

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Sout

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Mal

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New

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Aust

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Chin

aJa

pan

Thai

land

Upper level

Lower level

Mid-point

Source: Oliver Wyman Pandemic Navigator, available at https://pandemicnavigator.oliverwyman.com/

90%

80%

70%

60%

Proportion required for herd immunity

25© Oliver Wyman

0-49 years old

65% of U.S. population

50+ years old

35% of U.S. population

Average hospitalization rate

1.7% 12.1% 7x

Average infection fatality rate 0.06% 2.5% 44x

Expected deaths assuming 100% of group infected 121,000 2,903,000 24x

WE ARE CURRENTLY APPLYING BLUNT LOCKDOWN MEASURESHospital capacity requirements and fatalities are concentrated at older ages

Multiplier, 50+ vs. 0 – 49

26© Oliver Wyman

Economic healthWHAT IS

MOST IMPORTANT

Public health

Personal liberty Containment

Public sector

WHO SETS THE RULES

Privatesector

Federal government Local government

Future generationsWHO BEARS THE COST Current generations

STORES STRESS OVER HOW TO HANDLE CUSTOMER WHO WON’T WEAR MASK

WSJ, 5/16/2020

US AIRLINES TELL CREWS NOT TO FORCE PASSENGERS TO WEAR MASKS

Reuters, 5/12/2020

28© Oliver Wyman

Til SchuermannTil.Schuermann@oliverwyman.com

Helen LeisHelen.Leis@oliverwyman.com

Mick MoloneyMichael.Moloney@oliverwyman.com

THANK YOU; POST-WEBINAR LOGISTICS

Contact us Next webinar

• Next webinar on COVID and FS Impacts on May 27 at 4pm

29© Oliver Wyman

READ OUR LATEST INSIGHTS ABOUT COVID-19 AND ITS GLOBAL IMPACT ONLINE

Oliver Wyman and our parent company Marsh & McLennan (MMC) have been monitoring the latest events and are putting forth our perspectives to support our clients and the industries they serve around the world. Our dedicated COVID-19 digital destination will be updated daily as the situation evolves

Visit our dedicated COVID-19 website:https://www.oliverwyman.com/coronavirus

QUALIFICATIONS, ASSUMPTIONS, AND LIMITING CONDITIONSThis report is for the exclusive use of the Oliver Wyman client named herein. This report is not intended for general circulation or publication, nor is it to be reproduced, quoted, or distributed for any purpose without the prior written permission of Oliver Wyman. There are no third-party beneficiaries with respect to this report, and Oliver Wyman does not accept any liability to any third party.

Information furnished by others, upon which all or portions of this report are based, is believed to be reliable but has not been independently verified, unless otherwise expressly indicated. Public information and industry and statistical data are from sources we deem to be reliable; however, we make no representation as to the accuracy or completeness of such information. The findings contained in this report may contain predictions based on current data and historical trends. Any such predictions are subject to inherent risks and uncertainties. Oliver Wyman accepts no responsibility for actual results or future events.

The opinions expressed in this report are valid only for the purpose stated herein and as of the date of this report. No obligation is assumed to revise this report to reflect changes, events, or conditions, which occur subsequent to the date hereof.

All decisions in connection with the implementation or use of advice or recommendations contained in this report are the sole responsibility of the client. This report does not represent investment advice nor does it provide an opinion regarding the fairness of any transaction to any and all parties. In addition, this report does not represent legal, medical, accounting, safety, or other specialized advice. For any such advice, Oliver Wyman recommends seeking and obtaining advice from a qualified professional.