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Key points included

  • Open finance regulation could transform the sector
  • Shifting focus to consumers in a bid to rebuild trust
  • Flexibility and speed of claims to target younger people

Covered in this report

Consumers are often wary about buying insurance as most people get back less than they pay in and it can be difficult to put a value on peace of mind. Many consumers find it difficult to know what level of cover they will need, making it hard to compare the relative value of various policies. Additionally, there is widespread cynicism about the industry with more than half of people thinking that insurance companies always try to get out of paying a claim.


As a result, the market is intensely price-driven as the topline cost is a metric that is more easily comparable. However, a supercomplaint by Citizens Advice and an investigation into pricing practices by the FCA have highlighted the way the sector doesn’t always operate in the best interests of customers, leading many across the industry to rethink pricing structures and the way offers are used.

Expert analysis from a specialist in the field

Written by Thomas Slide, a leading analyst in the Financial Services sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Change is coming to the general insurance market, driven by the impact of new technology and innovative new businesses entering the sector, as well as by pressure from consumer groups and the FCA, unhappy at the way the market operates, particularly with regards to how long-standing customers are treated. 54% of people think insurance companies will always try to get out of paying a claim and more than half of under-35s feel unfairly penalised by the sector. There is clearly a long way to go to convince consumers that this is an industry that truly works in their best interests Thomas Slide
Senior Financial Services Analyst

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What's included

What's included

Table of contents

Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • Gross premiums hit £28 billion
              • Figure 1: General insurance revenue – retail products – UK risks, by gross written premiums, 2014-18
            • Motor insurance accounts for 41% of gross written premiums
              • Figure 2: Share of gross written premiums, by product type, 2018
            • Weather events hit property insurers
              • FCA investigates pricing practices in the GI sector
                • Companies and brands
                  • Insurance becomes faster and more flexible
                    • Addressing the loyalty penalty
                      • Total advertising expenditure falls 9.5% in 2018/19
                        • Figure 3: Total above-the-line, online display and direct mail advertising expenditure on general insurance, 2014/15-2018/19
                      • The consumer
                        • Car insurance is most widely held
                          • Figure 4: Types of insurance owned, September 2019
                        • Two thirds of mobile phone insurance policies held in packaged accounts
                          • Figure 5: Insurance held as part of a packaged account, September 2019
                        • 31% haven’t reviewed their policies in the past year
                          • Figure 6: Reasons for reviewing an insurance policy, September 2019
                        • Half have taken out a policy with a new provider in the past year
                          • Figure 7: General insurance switching, by age and gender, September 2019
                        • Comparison sites are widely used
                          • Figure 8: Actions taken prior to purchasing a new insurance policy, September 2019
                        • A balance of price and cover
                          • Figure 9: Important factors in choosing an insurer, September 2019
                        • Three quarters trust insurers with their data
                          • Figure 10: Insurance behaviours, September 2019
                        • An issue of trust in paying claims
                          • Figure 11: Attitudes towards insurance, September 2019
                        • What we think
                        • Issues and Insights

                          • Open finance regulation could transform the sector
                            • The facts
                              • The implications
                                • Shifting focus to consumers in a bid to rebuild trust
                                  • The facts
                                    • The implications
                                      • Flexibility and speed of claims to target younger people
                                        • The facts
                                          • The implications
                                          • The Market – What You Need to Know

                                            • Gross premiums hit £28 billion
                                              • Motor insurance accounts for 41% of gross written premiums
                                                • Weather events hit property insurers
                                                  • FCA investigates pricing practices in the General Insurance sector
                                                  • Market Size

                                                    • Gross Written Premiums hit £28 billion
                                                      • Figure 12: General insurance revenue – retail products – UK risks, by gross written premiums, 2014-18
                                                    • Rise in claims hits underwriting profits
                                                      • Figure 13: General insurance – retail products – UK outgo and underwriting result, 2014-18
                                                  • Market Segmentation

                                                    • Motor insurance grows its share of the general insurance market
                                                      • Figure 14: Share of GWP for general insurance retail products, by product type, 2018
                                                    • Motor insurance stabilises following 2017 increase
                                                      • Weather events hit property insurers
                                                        • Figure 15: Gross written premiums for general insurance, by insurance type, 2014-18
                                                        • Figure 16: Underwriting result, 2014-18
                                                        • Figure 17: Claims ratio, 2014-18
                                                    • Market Environment

                                                      • FCA investigates pricing practices in the General Insurance sector
                                                        • Change to the Personal Injury Discount
                                                          • Insurance Premium Tax remains at 12%
                                                            • Figure 18: Changes to Insurance Premium Tax, 2011-17
                                                        • Companies and Brands – What You Need to Know

                                                          • Insurance becomes faster and more adaptable
                                                            • Addressing the loyalty penalty
                                                              • Total advertising expenditure falls 9.5%
                                                              • Launch Activity and Innovation

                                                                • Simplicity and flexibility
                                                                  • Direct Line rolls out Darwin Insurance
                                                                    • HSBC launches ‘switchable’ subscription product
                                                                      • Brolly launches ‘simplest’ contents insurance
                                                                        • Short term motor insurance brand Jaunt launched by BGL Group
                                                                          • MORE TH>N launches fitness trackers for pet insurance
                                                                            • Taking action to deal with the loyalty penalty
                                                                              • Saga finds success with three-year fix
                                                                                • AvivaPlus subscription service
                                                                                  • Using technology to speed up cover and claims
                                                                                    • Tractable uses AI to settle claims faster
                                                                                      • Zego becomes first InsurTech to underwrite policies
                                                                                        • Bought by Many scraps waiting period
                                                                                        • Advertising and Marketing Activity

                                                                                          • Total advertising expenditure falls 9.5%
                                                                                            • Figure 19: Total above-the-line, online display and direct mail advertising expenditure on general insurance, 2014/15-2018/19
                                                                                          • Direct Line is the leading advertiser
                                                                                            • Figure 20: Leading spenders on above-the-line, online display and direct mail advertising expenditure on general insurance, 2014/15-2018/19
                                                                                          • Car insurance accounts for a quarter of spending
                                                                                            • Brand-building activity increases
                                                                                              • Figure 21: Above-the-line, online display and direct mail advertising expenditure on general insurance, by product category, 2018/19
                                                                                            • TV accounts for half of spending
                                                                                              • Figure 22: Expenditure on above-the-line, online display and direct mail advertising expenditure on general insurance, by media type, 2018/19
                                                                                            • Nielsen Ad Intel coverage
                                                                                            • The Consumer – What You Need to Know

                                                                                              • Car insurance is most widely held
                                                                                                • Two thirds of mobile phone insurance policies held in packaged accounts
                                                                                                  • 31% haven’t reviewed their policies in the past year
                                                                                                    • Half have taken out a policy with a new provider in the past year
                                                                                                      • Balancing price and cover
                                                                                                        • Three quarters trust insurers with their data
                                                                                                          • An issue of trust in paying claims
                                                                                                          • Insurance Ownership

                                                                                                            • Car insurance is most widely held
                                                                                                              • Figure 23: Types of insurance owned, September 2019
                                                                                                            • Young people not buying home insurance
                                                                                                                • Figure 24: Types of insurance held, by age and affluence, September 2019
                                                                                                              • Two thirds of mobile phone insurance policies held in packaged accounts
                                                                                                                • Figure 25: Insurance held as part of a packaged account, September 2019
                                                                                                            • Triggers to Reviewing a Policy

                                                                                                              • Almost a third haven’t reviewed their policies in the past year
                                                                                                                • Figure 26: Reasons for reviewing an insurance policy, September 2019
                                                                                                              • The importance of the customer experience
                                                                                                                • Figure 27: Reasons for reviewing an insurance policy, by age, September 2019
                                                                                                              • Older customers pushed into action by price rises
                                                                                                                  • Figure 28: Reasons for reviewing an insurance policy, by age, September 2019
                                                                                                              • Purchase Pathway for Insurance

                                                                                                                • Comparison sites are widely used
                                                                                                                    • Figure 29: Actions taken prior to purchasing a new insurance policy, September 2019
                                                                                                                  • Car insurance buyers most likely to visit comparison sites
                                                                                                                    • Figure 30: Actions taken before purchasing a new insurance policy in the past 12 months, by insurance policy most recently taken out, September 2019
                                                                                                                • Insurance Switching

                                                                                                                  • Half have taken out a policy with a new provider in the past year
                                                                                                                    • Figure 31: Taken out an insurance policy with a new provider in the past year, by age, September 2019
                                                                                                                  • Bad experiences are most likely to drive a change of insurer
                                                                                                                    • Figure 32: Taken out an insurance policy with a new provider in the last 12 months, by reasons for reviewing an insurance policy in the last 12 months, September 2019
                                                                                                                • Important Factors When Choosing Insurance

                                                                                                                  • A balance of price and cover
                                                                                                                    • Figure 33: Important factors in choosing an insurer, September 2019
                                                                                                                  • Price is most important to 45-54 year olds
                                                                                                                    • Figure 34: Most important factor in choosing general insurance, by age, September 2019
                                                                                                                  • Speed and flexibility appeal to the young
                                                                                                                    • Figure 35: Important factors (any rank) in choosing an insurer, by age and socio-economic group, September 2019
                                                                                                                • Insurance Behaviours

                                                                                                                  • Three quarters trust insurers with their data
                                                                                                                      • Figure 36: Insurance behaviours, September 2019
                                                                                                                    • Over half of under-35s feel unfairly penalised by insurers
                                                                                                                      • Figure 37: “I feel unfairly penalised by insurers”, by age, September 2019
                                                                                                                    • Younger people lack an understanding of insurance
                                                                                                                      • Figure 38: Selected insurance behaviours, by age, September 2019
                                                                                                                  • Attitudes towards Insurance

                                                                                                                    • An issue of trust
                                                                                                                      • Figure 39: Attitudes towards insurance, September 2019
                                                                                                                    • Loyalty over introductory discounts
                                                                                                                        • Figure 40: “Insurers should focus more on rewarding loyalty than on offering discounts for new customers”, by age, September 2019
                                                                                                                      • Young people value simplicity
                                                                                                                        • Figure 41: “It's preferable to have the majority of policies with a single insurer”, by age, September 2019
                                                                                                                    • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                        • Abbreviations
                                                                                                                          • Consumer research methodology

                                                                                                                          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.

                                                                                                                          Description