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Description

Description

“Consumers face a dilemma when arranging insurance, between the unrivalled convenience of price comparison sites and the reliability and accuracy of going directly to an insurer. Face-to-face broker services may be increasingly rare, but are still associated with professionalism and expertise –valuable qualities in a market where consumer trust is low.”

– Deborah Osguthorpe, Head of UK Financial Services Research

Some questions answered in this report include:
  • To what extent are consumers trying to reduce the amount they spend on insurance cover?
  • Is brand an important consideration when arranging insurance cover?
  • How can insurers compete with price comparison sites?
  • Do face-to-face channels still have a role to play in insurance distribution?

What's included

What's included

Table of contents

Table of contents

  1. Introduction

      • Market definitions
        • Note on consumer research
          • Abbreviations
          • Executive Summary

              • The market
                • One in four owns five or more different types of insurance cover
                  • Figure 1: General insurance product ownership, August 2012
                • General insurance premiums increased by 5% in 2011
                  • Figure 2: NWP, total outgoings, net claims and underwriting result for UK annual general business, 2007-11
                • Market factors
                  • A challenging economic backdrop and a plethora of regulatory changes
                    • Companies, brands and innovation
                      • Aviva takes over as leading UK general insurance underwriter
                        • Figure 3: Largest general insurers/reinsurers – total market (direct and facultative business), by GWP, 2011
                      • Adspend continued to fall in 2011/12
                        • The consumer
                          • Online channels dominate but offline channels still have a role to play
                            • Figure 4: Channels used to arrange insurance, August 2012
                          • Price comparison sites are seen as convenient but lack accuracy
                            • Telephone services are the preferred option when making a claim or policy amendments
                              • Figure 5: Channel preferences for different insurance-related activities, August 2012
                            • The majority shop around at their insurance renewal
                              • Figure 6: Approaches to renewing insurance cover, August 2012
                            • Cost, cover and UK call-centres are all seen as important considerations
                              • Figure 7: Purchasing considerations by importance, August 2012
                            • 50% of all insurance policyholders are looking to reduce their insurance expenditure
                              • Figure 8: Attitudes towards spending on general insurance products, August 2012
                            • What we think
                            • Issues in the Market

                                • To what extent are consumers trying to reduce the amount they spend on insurance cover?
                                  • Is brand an important consideration when arranging insurance cover?
                                    • How can insurers compete with price comparison sites?
                                      • Do face-to-face channels still have a role to play in insurance distribution?
                                      • Trend Application

                                        • Time saving devices for multi-product owners
                                          • Promoting Brand Britannia
                                            • Providing a seamless, multi-channel service
                                            • Market Environment

                                              • Key points
                                                • Challenging economy creates a more price sensitive consumer
                                                  • Figure 9: UK GDP growth – percentage change, latest quarter on previous quarter, 2009-12
                                                • Motor insurance premiums fall, but home insurance premiums are rising
                                                  • Figure 10: AA British Insurance Premium Index market average trends, April 2009-October 2012
                                                • Weather-related claims remain a concern for property insurers
                                                  • Regulatory and legislative issues
                                                    • Market gearing up for implementation of EU gender ruling
                                                      • Ban on referral fees on the horizon
                                                        • Competition under the microscope
                                                          • Solvency II delayed again
                                                            • FSA clamps down on sale of bundled insurance products
                                                              • FSA to monitor sale of low cost insurance policies
                                                              • General Insurance Market Size

                                                                • Key points
                                                                  • General insurance premiums rise again
                                                                    • Figure 11: Summary of annual general insurance business – UK risks, by sector NWPs, 2007-11
                                                                  • Motor insurance premiums up by 10% in 2011
                                                                    • Property premiums rise following adverse weather conditions
                                                                      • General insurance market returned to underwriting profit in 2011
                                                                        • Figure 12: UK outgo and underwriting result for annual general insurance business, 2007-11
                                                                      • Improvements in both motor and property underwriting ratio
                                                                        • Figure 13: Underwriting ratio – UK annual general insurance business by sector, 2007-11
                                                                        • Figure 14: Claims ratio – UK annual general insurance business, by sector, 2007-11
                                                                    • Market Segmentation

                                                                      • Key points
                                                                        • Private motor accounted for 29% of total premium income in 2011
                                                                          • Figure 15: Share of premium income (UK annual business), by sector, 2011
                                                                        • Pet insurance premiums rise, but travel premiums fall
                                                                          • Figure 16: Premium analysis of UK general insurance business, 2006-07-2010-11
                                                                      • Underwriter Share

                                                                        • Key points
                                                                          • Aviva takes over as the leading UK general insurance underwriter
                                                                            • Figure 17: Largest general insurers/reinsurers – total market (direct and facultative business), by GWP, 2009-11
                                                                        • Companies and Products

                                                                          • Aviva
                                                                              • Figure 18: Key financial data for Aviva UK General Insurance business, H1 2011-H1 2012
                                                                              • Figure 19: Key financial data for Aviva UK General Insurance business, 2010-11
                                                                            • AXA Insurance
                                                                              • Chartis Insurance (AIG)
                                                                                  • Figure 20: Key financial data for Chartis (AIG) UK, 2010-11
                                                                                • Direct Line Group (formerly RBS Insurance)
                                                                                    • Figure 21: Key financial data for Direct Line Group, H1 2011-H1 2012
                                                                                    • Figure 22: Key financial data for RBS Insurance*, 2010-11
                                                                                  • RSA Insurance
                                                                                      • Figure 23: Key financial data for RSA UK Insurance, H1 2011-H1 2012
                                                                                      • Figure 24: Key financial data for RSA UK Insurance, 2010-11
                                                                                  • Brand Communication and Promotion

                                                                                    • Key points
                                                                                      • Adspend on general insurance products fell by 1.4% in 2011/12
                                                                                        • Figure 25: Topline adspend for general insurance products, 2009/10-2011/12
                                                                                      • Car insurance dominates the market
                                                                                        • Figure 26: Adspend, by general insurance category, 2009/10-2011/12
                                                                                      • TV advertising is the most popular channel for insurance adspend
                                                                                        • Figure 27: General insurance adspend, by media type, 2009/10-2011/12
                                                                                      • Majority of top 20 insurers increased adspend over last 12 months
                                                                                        • Figure 28: Top 20 general insurance advertisers, 2009/10-2011/12
                                                                                    • General Insurance Product Ownership

                                                                                      • Key points
                                                                                        • Most consumers have experience of general insurance market
                                                                                          • Figure 29: General insurance product ownership, August 2012
                                                                                        • Appetite for risk is lower among older consumers
                                                                                          • Figure 30: Responses to statements about risk and insurance, by age group, 2012
                                                                                        • Cover for technology could help to engage the young
                                                                                          • One in four have five or more types of general insurance cover
                                                                                            • Figure 31: General insurance product ownership, by number of products held, August 2012
                                                                                            • Figure 32: General insurance product ownership, by general insurance product ownership, August 2012
                                                                                          • Online tools to help multiple product holders
                                                                                          • Channels Used to Arrange General Insurance Products

                                                                                            • Key points
                                                                                              • Price comparison sites tighten grip on general insurance market…
                                                                                                • Figure 33: Channels used to arrange selected insurance products, August 2012
                                                                                              • …although offline channels still have a role to play
                                                                                                • Younger adults are more likely than average to use face-to-face channels
                                                                                                • Attitudes Towards Channels of Distribution

                                                                                                  • Key points
                                                                                                    • Price comparison sites are seen as the most convenient channel…
                                                                                                      • Figure 34: Channel associations, August 2012
                                                                                                    • …but insurer websites lead the way when it comes to accuracy
                                                                                                      • Brokers associated with reassurance and expertise
                                                                                                        • Figure 35: Correspondence analysis – attitudes towards channels of distribution, August 2012
                                                                                                      • Insurers have an edge in terms of reliability and trust
                                                                                                      • Channel Preferences for Managing General Insurance Policies

                                                                                                        • Key points
                                                                                                          • Consumers seek a multi-channel approach to managing insurance cover
                                                                                                            • Figure 36: Channel preferences for different insurance-related activities, August 2012
                                                                                                          • Higher income groups are the most inclined to use online channels
                                                                                                            • Making a claims remains a personal service
                                                                                                            • Approaches to Renewing General Insurance Products

                                                                                                              • Key points
                                                                                                                • Shopping around at renewal is now commonplace
                                                                                                                  • Figure 37: Approaches to renewing insurance cover, August 2012
                                                                                                                • Consumers see little reward in being loyal
                                                                                                                  • Insurance switchers are driven by price
                                                                                                                    • Figure 38: Reasons for switching car or home insurance, May 2012
                                                                                                                  • Is there any degree of loyalty left?
                                                                                                                    • Channel preference is linked to loyalty
                                                                                                                      • Figure 39: Approaches to renewing insurance cover, by channels used to arrange insurance, August 2012
                                                                                                                  • Insurance Provider Selection

                                                                                                                    • Key points
                                                                                                                      • Striking a balance between cost and cover
                                                                                                                        • Figure 40: Purchasing considerations by importance, August 2012
                                                                                                                      • UK-based call centres are a bigger consideration than brand
                                                                                                                        • Under 35s are more likely to look for provider recommendations
                                                                                                                          • Figure 41: Proportion of respondents that feel recommendations are an important insurance purchasing consideration, by age group, August 2012
                                                                                                                        • Loyal policyholders are more likely to select provider based on brand
                                                                                                                          • Figure 42: Importance of purchasing considerations, by approaches to renewing insurance cover, August 2012
                                                                                                                      • Attitudes Towards Spending on General Insurance Products

                                                                                                                        • Key points
                                                                                                                          • Almost 50% of policyholders are looking to reduce their insurance spend
                                                                                                                            • Figure 43: Attitudes towards spending on general insurance products, August 2012
                                                                                                                          • Shopping around for a cheaper deal
                                                                                                                            • Figure 44: Approaches to renewing insurance cover, attitudes towards spending on general insurance products, August 2012
                                                                                                                          • Quality seekers need to see added value
                                                                                                                            • Value chasers are more inclined to move providers mid-term
                                                                                                                              • Multiple product owners are more demanding
                                                                                                                                • Figure 45: Attitudes towards spending on general insurance products, by general insurance product ownership, August 2012
                                                                                                                              • Brand is more likely to be a consideration for those seeking reassurance
                                                                                                                                • Figure 46: Importance of purchasing considerations, by attitudes towards spending on general insurance products, August 2012
                                                                                                                            • Appendix – General Insurance Product Ownership

                                                                                                                                • Figure 47: Most popular general insurance product ownership, by demographics, August 2012
                                                                                                                                • Figure 48: Next most popular general insurance product ownership, by demographics, August 2012
                                                                                                                                • Figure 49: Other general insurance product ownership, by demographics, August 2012
                                                                                                                                • Figure 50: General insurance product ownership repertoire analysis (number of products held), by demographics, August 2012
                                                                                                                            • Appendix – Channels Used to Arrange General Insurance Products

                                                                                                                                • Figure 51: Channels used to arrange insurance, August 2012
                                                                                                                                • Figure 52: Channels used to arrange car insurance, by demographics, August 2012
                                                                                                                                • Figure 53: Channels used to arrange home contents insurance, by demographics, August 2012
                                                                                                                                • Figure 54: Channels used to arrange buildings insurance, by demographics, August 2012
                                                                                                                                • Figure 55: Channels used to arrange annual travel insurance, by demographics, August 2012
                                                                                                                                • Figure 56: Channels used to arrange medical/health insurance, by demographics, August 2012
                                                                                                                                • Figure 57: Channels used to arrange pet insurance, by demographics, August 2012
                                                                                                                            • Appendix – Attitudes Towards Channels of Distribution

                                                                                                                                • Figure 58: Top five price comparison websites for channel associations, by demographics, August 2012
                                                                                                                                • Figure 59: Top five insurer websites for channel associations, by demographics, August 2012
                                                                                                                                • Figure 60: Top five insurer telephone services for channel associations, by demographics, August 2012
                                                                                                                                • Figure 61: Top five broker face-to-face or telephone services for channel associations, by demographics, August 2012
                                                                                                                            • Appendix – Channel Preferences for Managing General Insurance Policies

                                                                                                                                • Figure 62: Channel preferences for researching a new policy, by demographics, August 2012
                                                                                                                                • Figure 63: Channel preferences for purchasing a new policy, by demographics, August 2012
                                                                                                                                • Figure 64: Channel preferences for query policy details, by demographics, August 2012
                                                                                                                                • Figure 65: Channel preferences for renewing an existing policy, by demographics, August 2012
                                                                                                                                • Figure 66: Channel preferences for amendments/change to an existing policy, by demographics, August 2012
                                                                                                                                • Figure 67: Channel preferences for cancelling a policy, by demographics, August 2012
                                                                                                                                • Figure 68: Channel preferences for making a claim, by demographics, August 2012
                                                                                                                            • Appendix – Approaches to Renewing General Insurance Products

                                                                                                                                • Figure 69: Approaches to renewing insurance cover, by demographics, August 2012
                                                                                                                            • Appendix – Insurance Provider Selection

                                                                                                                                • Figure 70: Importance of the cost of cover, by demographics, August 2012
                                                                                                                                • Figure 71: Importance of a well-known brand, by demographics, August 2012
                                                                                                                                • Figure 72: Importance of a quick and easy application process, by demographics, August 2012
                                                                                                                                • Figure 73: Importance of a recommendation from family/friends, by demographics, August 2012
                                                                                                                                • Figure 74: Importance of positive feedback/recommendation on online forums and social media, by demographics, August 2012
                                                                                                                                • Figure 75: Importance of the quality of cover provided, by demographics, August 2012
                                                                                                                                • Figure 76: Importance of rewards for loyalty, by demographics, August 2012
                                                                                                                                • Figure 77: Importance of UK-based call centres, by demographics, August 2012
                                                                                                                            • Appendix – Attitudes Towards Spending on General Insurance Products

                                                                                                                                • Figure 78: General insurance product ownership, attitudes towards spending on general insurance products, August 2012
                                                                                                                                • Figure 79: Attitudes towards spending on general insurance products, August 2012

                                                                                                                            About the report

                                                                                                                            This report will give you a complete 360-degree view of your market. Not only is it rooted in robust proprietary and high-quality third-party data, but our industry experts put that data into context and you’ll quickly understand:

                                                                                                                            • The Consumer

                                                                                                                              What They Want. Why They Want It.

                                                                                                                            • The Competitors

                                                                                                                              Who’s Winning. How To Stay Ahead.

                                                                                                                            • The Market

                                                                                                                              Size, Segments, Shares And Forecasts: How It All Adds Up.

                                                                                                                            • The Innovations

                                                                                                                              New Ideas. New Products. New Potential.

                                                                                                                            • The Opportunities

                                                                                                                              Where The White Space Is. How To Make It Yours.

                                                                                                                            • The Trends

                                                                                                                              What’s Shaping Demand – Today And Tomorrow.

                                                                                                                            Please Note: This is a sample report. All of the figures, graphs, and tables have been redacted.

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