Uk Commercial Insurance Distribution 2016: Jsbmarketresearch

UK Commercial Insurance Distribution 2016; an industry where adapting to the market is key

Released on 11th April 2016

Summary

Commercial insurance has become a highly competitive market, and the distribution of its products is evolving. Brokers continue to hold the highest share of the commercial market, despite growth in other channels. The small and medium-sized enterprise (SME) market has been driving this change. SMEs that require less comprehensive insurance products have been moving away from the added-value advice service from brokers, instead shifting towards self-service, online purchasing platforms.

The broker landscape continues to be dominated by the top few global companies and a multitude of smaller firms. Consolidation of the broker market is set to continue; however, the rate of acquisitions has significantly slowed after the major consolidation and growth rush of the late 2000s. Brokers are now looking to use their existing products and sectors of expertise to grow, meanwhile focusing on developing their online propositions to enable them to regain share previously lost by the SME market.

The Insurance Act 2015, which comes into force in August 2016 will make significant changes to commercial contract law. It will make contracts more certain and passes the responsibility of compliance to insurers. It will promote better communication and co-operation between all parties involved in arranging commercial contracts, ultimately giving underwriters a better understanding of the practices and the subsequent risks of those being insured.

Key Findings

- Brokers continue to dominate the distribution of commercial insurance, with a 78.2% share of the market.

- Provincial brokers are less concerned about growing their online propositions.

- Banks have the potential to cross-sell insurance with their existing business services.

- Micro-sized enterprises are driving the growth of price comparison sites....