Table of Contents
Executive Summary
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- The market
- Gross premiums hit £28 billion
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- Figure 1: General insurance revenue – retail products – UK risks, by gross written premiums, 2014-18
- Motor insurance accounts for 41% of gross written premiums
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- 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
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- 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
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- Figure 4: Types of insurance owned, September 2019
- Two thirds of mobile phone insurance policies held in packaged accounts
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- Figure 5: Insurance held as part of a packaged account, September 2019
- 31% haven’t reviewed their policies in the past year
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- Figure 6: Reasons for reviewing an insurance policy, September 2019
- Half have taken out a policy with a new provider in the past year
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- Figure 7: General insurance switching, by age and gender, September 2019
- Comparison sites are widely used
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- Figure 8: Actions taken prior to purchasing a new insurance policy, September 2019
- A balance of price and cover
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- Figure 9: Important factors in choosing an insurer, September 2019
- Three quarters trust insurers with their data
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- Figure 10: Insurance behaviours, September 2019
- An issue of trust in paying claims
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- Figure 11: Attitudes towards insurance, September 2019
- What we think
Issues and Insights
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- 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
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- 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
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- Gross Written Premiums hit £28 billion
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- Figure 12: General insurance revenue – retail products – UK risks, by gross written premiums, 2014-18
- Rise in claims hits underwriting profits
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- Figure 13: General insurance – retail products – UK outgo and underwriting result, 2014-18
Market Segmentation
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- Motor insurance grows its share of the general insurance market
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- 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
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- Figure 15: Gross written premiums for general insurance, by insurance type, 2014-18
- Figure 16: Underwriting result, 2014-18
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- Figure 17: Claims ratio, 2014-18
Market Environment
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- FCA investigates pricing practices in the General Insurance sector
- Change to the Personal Injury Discount
- Insurance Premium Tax remains at 12%
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- Figure 18: Changes to Insurance Premium Tax, 2011-17
Companies and Brands – What You Need to Know
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- Insurance becomes faster and more adaptable
- Addressing the loyalty penalty
- Total advertising expenditure falls 9.5%
Launch Activity and Innovation
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- 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
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- Total advertising expenditure falls 9.5%
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- 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
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- 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
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- 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
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- 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
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- 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
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- Car insurance is most widely held
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- Figure 23: Types of insurance owned, September 2019
- Young people not buying home insurance
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- Figure 24: Types of insurance held, by age and affluence, September 2019
- Two thirds of mobile phone insurance policies held in packaged accounts
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- Figure 25: Insurance held as part of a packaged account, September 2019
Triggers to Reviewing a Policy
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- Almost a third haven’t reviewed their policies in the past year
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- Figure 26: Reasons for reviewing an insurance policy, September 2019
- The importance of the customer experience
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- Figure 27: Reasons for reviewing an insurance policy, by age, September 2019
- Older customers pushed into action by price rises
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- Figure 28: Reasons for reviewing an insurance policy, by age, September 2019
Purchase Pathway for Insurance
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- Comparison sites are widely used
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- Figure 29: Actions taken prior to purchasing a new insurance policy, September 2019
- Car insurance buyers most likely to visit comparison sites
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- 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
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- Half have taken out a policy with a new provider in the past year
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- 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
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- 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
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- A balance of price and cover
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- Figure 33: Important factors in choosing an insurer, September 2019
- Price is most important to 45-54 year olds
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- Figure 34: Most important factor in choosing general insurance, by age, September 2019
- Speed and flexibility appeal to the young
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- Figure 35: Important factors (any rank) in choosing an insurer, by age and socio-economic group, September 2019
Insurance Behaviours
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- Three quarters trust insurers with their data
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- Figure 36: Insurance behaviours, September 2019
- Over half of under-35s feel unfairly penalised by insurers
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- Figure 37: “I feel unfairly penalised by insurers”, by age, September 2019
- Younger people lack an understanding of insurance
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- Figure 38: Selected insurance behaviours, by age, September 2019
Attitudes towards Insurance
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- An issue of trust
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- Figure 39: Attitudes towards insurance, September 2019
- Loyalty over introductory discounts
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- Figure 40: “Insurers should focus more on rewarding loyalty than on offering discounts for new customers”, by age, September 2019
- Young people value simplicity
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- 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
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- Abbreviations
- Consumer research methodology
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