Table of Contents
Executive Summary
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- The market
- ‘On the go’ internet use becomes the norm
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- Figure 1: Using the internet ‘on the go’, by age, 2013-18
- Intentions to buy remain robust
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- Figure 2: Technology products: recent ownership and intentions to buy, June 2018
- The average household owns possessions worth £35,000
- GDPR and Open Banking come into force
- FCA considers ban on sale of extended warranties alongside rent-to-own agreements
- Companies and brands
- Standalone gadget insurers want to stand out from the crowd
- Alternative distribution channels: mobile network operators
- Launch activity and innovation
- First dedicated gadget insurance comparison site launched
- Challengers incorporate insurance into app-only banking proposition
- The consumer
- 36% of Millennials have four or more types of gadgets
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- Figure 3: Ownership of gadgets, September 2018
- Home insurance is the most common way of insuring gadgets
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- Figure 4: Penetration of gadget insurance, by type of gadget, September 2018
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- Figure 5: Penetration of gadget insurance, by type of coverage and gadget, September 2018
- Increasing cost of gadgets is powerful argument in favour of insurance
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- Figure 6: Reasons for not having gadget insurance, September 2018
- People want to keep their gadgets for longer and want to protect them
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- Figure 7: Attitudes towards gadgets, September 2018
- Time of gadget purchase is crucial for insurance sales
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- Figure 8: Gadget risk exposure, September 2018
- Consumers want simplicity but there is room for personalisation
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- Figure 9: Attitudes towards gadget insurance, September 2018
- What we think
Issues and Insights
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- Extended warranties: right place, right time
- The facts
- The implications
- Keeping gadgets for longer: insurance and the sustainability angle
- The facts
- The implications
The Market – What You Need to Know
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- ‘On the go’ internet use becomes the norm
- Average possessions worth £35,000 but many are uninsured
- Competitor Products – Wide Choice But Clear Differences
- Home contents
- Extended warranties
- Financial products
- GDPR and Open Banking come into force
- FCA considers ban on sale of extended warranties alongside rent-to-own agreements
Market Drivers
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- Majority of people use the internet ‘on the go’
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- Figure 10: Using the internet ‘on the go’, by age, 2013-18
- Preferred devices give an indication of the scope for gadget insurance
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- Figure 11: Using the internet ‘on the go’, by device and age, 2018
- Intentions to buy remain robust
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- Figure 12: Technology products: recent ownership and intentions to buy, June 2018
- The average household owns possessions worth £35,000
- 81% of ‘Generation Rent’ without contents cover
Competitor Products
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- Home contents
- Extended warranties
- Financial products
Regulatory and Legislative Changes
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- FCA looks to measure value of add-ons
- GDPR and Open Banking come into force
- FCA considers ban on sale of extended warranties alongside rent-to-own agreements
Companies and Brands – What You Need to Know
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- Competitive strategies
- Standalone gadget insurers want to stand out from the crowd
- Alternative distribution channels: mobile network operators
- Launch activity and innovation
- First dedicated gadget insurance comparison site launched
- Challengers incorporate insurance into app-only banking proposition
Competitive Strategies
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- ZugarZnap’s Millennial proposition
- Alternative distribution channels: mobile network operators
- Social media campaigns
- Cashback sites
Case study – Trōv’s On-demand Insurance
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- Insure whatever you love…
- …whenever you need it…
- …directly from your phone
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- Figure 13: Trōv’s user interface
- Dynamic price adjustment
Launch Activity and Innovation
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- First dedicated gadget insurance comparison site launched
- Starling Bank’s in-app marketplace offering so-sure smartphone insurance
- Revolut partners with Simplesurance to offer entirely digital mobile phone insurance
The Consumer – What You Need to Know
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- 36% of Millennials have four or more types of gadgets
- Home insurance is the most common way of insuring gadgets
- Increasing cost of gadgets is powerful argument in favour of insurance
- People want to keep their devices for longer and take steps to protect them
- Time of gadget purchase is crucial for insurance sales
- Parents are a key demographic
Ownership of Gadgets
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- Gadget ownership is almost universal among adults
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- Figure 14: Ownership of gadgets, September 2018
- 36% of Millennials have four or more types of gadgets
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- Figure 15: Repertoire of gadgets owned, by generation, September 2018
Penetration of Gadget Insurance
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- 43% of smartphone owners have insurance
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- Figure 16: Penetration of gadget insurance, by type of gadget, September 2018
- Gadget insurance is a minority option…
- …but increases among more regularly used products
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- Figure 17: Penetration of gadget insurance, by type of coverage and gadget, September 2018
Reasons for Not Having Gadget Insurance
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- Increasing cost of gadgets is powerful argument in favour of insurance
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- Figure 18: Reasons for not having gadget insurance, September 2018
- Uninsured owners tend to have one main reason for not buying a policy
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- Figure 19: Repertoire of reasons for having uninsured gadgets, September 2018
Attitudes towards Gadgets
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- Two thirds claim to always take precautions with their devices
- People are aware they could do more
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- Figure 20: Attitudes towards gadgets, September 2018
- Finding potential customers among those who have broken a gadget
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- Figure 21: Consumers and gadget insurance – CHAID – Tree output, September 2018
Gadget Risk Exposure
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- Worldwide cover is key
- Good timing is essential for sales
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- Figure 22: Gadget risk exposure, September 2018
- Owners of uninsured gadgets are less concerned
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- Figure 23: Gadget risk exposure, by type of coverage, September 2018
Attitudes towards Gadget Insurance
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- Consumers want simplicity…
- …but there is room for personalisation
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- Figure 24: Attitudes towards gadget insurance, September 2018
- Existing policyholders more open to innovative options
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- Figure 25: Agreement with attitudes towards gadget insurance, by type of coverage, September 2018
- Capturing parents’ attention
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- Figure 26: Agreement with attitudes towards gadget insurance, parents^ vs non-parents, September 2018
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
- CHAID Analysis Methodology
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