LONDON, July 06, 2022 (GLOBE NEWSWIRE) -- The “United Kingdom (UK) SME Insurance – Purchasing Journey 2021” report offered by GlobalData Plc provides insights on how SMEs buy insurance coverage and the reasons behind their purchasing decisions. It examines the channels used by SMEs when purchasing insurance, pre-purchase activities, switching behavior, and whether SMEs are considering canceling any of their existing policies. The report uses results from our annual UK SME Insurance Survey, as well as additional in-depth interviews with industry leaders.
Brokers remain the most popular channel for SMEs when purchasing insurance. However, brokers’ share of the sole trader segment has declined notably, with direct sales proportionally increasing, as certain insurers made a strong push in the sole trader market.
UK SME Insurance Market Dynamics
The total number of SMEs has declined since the onset of the COVID-19 pandemic. However, they still play a major role in the UK economy, accounting for virtually all businesses in the UK at the start of 2021. Those providers that are able to demonstrate an understanding of how businesses have had to adapt and that can advise them on their changing customer needs are best placed for future business and higher customer retention. Key areas for investment include automated claims processing, the use of artificial intelligence to improve underwriting performance, and automated advice capabilities such as robo-advice to enable SMEs to self-serve while still receiving advice. Despite representing high upfront costs, such investments will prove beneficial in the long run.
Download a sample report for more insights on the UK SME insurance market
UK SME Insurance Market Segment Analysis by Purchasing Channels
- Broker
- Direct Sales
- Bank
- PCWs
Broker: Brokers remained the most popular purchasing channel among UK SMEs in 2021, accounting for almost half of purchases. Although their share dipped compared to 2020, brokers will always play a key role in this space due to their ability to offer advice and a range of products that can best fit a business’s needs.
Direct Sales: The direct channel enjoyed a resurgence in 2021, which was mainly driven by sole trader and micro enterprise activity. Direct sales were particularly strong among sole traders and micro enterprises.
Bank: Banks’ share of the market dipped noticeably in 2021 after years of steady growth. Banks were pushed out by more direct sales and an increase in use of PCWs by small and medium businesses in 2021.
PCWs: PCWs are the fourth most popular channel. PCW activity particularly increased among small and medium businesses – especially for commercial vehicle insurance – indicating growing price sensitivity. But PCWs ultimately have their limitations, particularly for larger businesses. And they do not offer advice, which means they are unlikely to increase their share much more due to the need for tailored advice. However, studies suggest that they will remain popular as a pre-purchase check among SMEs to see what other offers are available, even if they are not necessarily the final point of purchase.
UK SME Insurance Market, by Purchasing Channel
Download a sample report for detailed purchasing channel insights on the UK SME insurance market
UK SME Insurance Market Report Scope
This report looks at how SMEs buy insurance coverage and the reasons behind their purchasing decisions. It examines the channels used by SMEs when purchasing insurance, pre-purchase activities, switching behavior, and whether SMEs are considering canceling any of their existing policies. The report uses results from our annual UK SME Insurance Survey, as well as additional in-depth interviews with industry leaders
Reasons to Buy
- Identify the most prominent sales channels for SMEs.
- Adapt or re-evaluate your distribution strategy and proposition to meet the needs of modern customers.
- Discover the factors influencing SME purchasing decisions and distribution channel selection.
- Understand switching behaviors among different client segments and insurance products.
- Evaluate the impact of COVID-19 on buying behaviors of SMEs.
- Learn how important insurers’ record on sustainability is for their corporate customers.
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UK SME Insurance Market Overview
| Purchasing Channels | Broker, Bank, Direct Sales, and PCWs |
FAQs
Which are the key purchasing channels in the UK SME insurance market?
The key purchasing channels in the UK SME insurance market are brokers, banks, direct sales, and PCWs.
Table of Contents
Executive Summary
Critical Success Factors
The UK SME Landscape
Purchasing Channels
Provider Selection and Customer Retention
Future Switching and Cancellations
Appendix
About us
GlobalData is a leading provider of data, analytics, and insights on the world's largest industries. In an increasingly fast-moving, complex, and uncertain world, it has never been harder for organizations and decision makers to predict and navigate the future. This is why GlobalData's mission is to help our clients to decode the future and profit from faster, more informed decisions. As a leading information services company, thousands of clients rely on GlobalData for trusted, timely, and actionable intelligence. Our solutions are designed to provide a daily edge to professionals within corporations, financial institutions, professional services, and government agencies.
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