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UK SME Insurance 2012: Market Dynamics & Opportunities - Product Image

UK SME Insurance 2012: Market Dynamics & Opportunities

  • ID: 2375833
  • November 2012
  • Region: United Kingdom, Great Britain
  • Datamonitor
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  • AXA
  • Hutchison 3G UK Limited
  • Wolters Kluwer nv
  • MORE

The incredibly competitive SME market is still evolving as insurers master fast-flow distribution strategies for commercial products. Considered positioning of SME propositions are vital when difficult current economic conditions and a mature market mean insurer ambitions to achieve marked growth will likely come at the cost of rivals' business.


- Target prospects emerging from shifts in the shape of the SME market and changes in product penetration rates.

- Develop strategies to attack opportunities arising from the key concerns of SMEs.


- Director’s and officers’ liability insurance saw a marked increase in purchase rates between 2011 and 2012 according to Datamonitor research, suggesting an opportunity for insurers to expand in the market.

- Damage to business reputation and customer data loss are the key concerns for SMEs, providing a great opportunity for cyber insurance products targeted at this market.

Reasons to Purchase

- How large is the SME insurance market and what potential business can be won by business size segment?

- What insurance opportunities are emerging from the concerns of SMEs or growth in particular trade sectors?

Note: Product cover images may vary from those shown
2 of 4


  • AXA
  • Hutchison 3G UK Limited
  • Wolters Kluwer nv
  • MORE


- Catalyst
- Summary


- Introduction
- The number of enterprises at the start of 2012 grew by 5.6%- 99.9% of UK businesses are SMEs, representing 48.8% of total turnover
- Micro-enterprises have been the predominant growth sector driving the number of UK businesses
- Company registrations continue to grow while liquidations saw a decline from Q2 2012- New company registrations have grown year-on-year since 2009–10
- Company liquidations slowed from Q2 2012 but businesses continue to face uncertainty
- Construction remains the largest SME market industry- 19% of SMEs lie within the construction industry
- Administrative and support services grew its share of SME businesses by 1% in 2012


- Introduction
- The SME insurance market was estimated at £5.4bn GWP in 2011- The economic recovery promises only a sluggish market for commercial insurers before 2016
- The SME market accounts for 35.8% of commercial insurance gross written premium
- Brokers expect SME insurance rates to rise modestly in 2013
- The SME insurance market's GWP is forecast to reach over £6.5bn in 2016
- Liability insurance is the most commonly purchased insurance by SMEs- SME insurance needs vary depending on business size and complexity of trade risk
- Liability insurance, as compulsory cover for employees, is held by 72% of SMEs
- SMEs within manufacturing and construction sectors are most likely to purchase public liability insurance
- Many SMEs lack adequate business continuity cover
- Opportunities arise from shifts in SME business concerns and purchasing behavior- Purchase of SME insurance from the direct channel is increasing in popularity
- The key SME fears demonstrate a strong opportunity for expansion of cyber liability insurance
- Underinsurance is not a major concern for SMEs, limiting insurers' ability to highlight this issue


- Definitions- Banks/building societies
- Brokers
- Direct
- Price comparison websites
- Utilities/retailers/affinity groups
- Earned premiums
- Gross premium
- Written premiums
- Small and medium-sized enterprise (SME)
- Methodology
- Datamonitor's 2012 SME Insurance Survey
- Datamonitor's 2012 Commercial Broker Survey
- Further reading
- Ask the analyst
- Disclaimer


- Table: Profile of UK enterprises by volume, employee numbers, and turnover, 2012
- Table: Number of new enterprises registered at Companies House, April 2007 to March 2012
- Table: England and Wales company insolvencies, 2006–Q3 2012
- Table: UK SMEs by industry sector split
- Table: Total SME market GWP, by segment (£000s), 2012
- Table: UK SME insurance forecast GWP (£000s) and growth rate (%), 2011e–16f
- Table: SME key business concerns, 2012


- Figure: The number of UK enterprises saw its strongest growth in 2012 since the flat-line of 2008
- Figure: Large companies account for only 0.1% of registered private enterprises
- Figure: Only the number of micro-enterprises has seen year-on-year growth since 2009
- Figure: The growth in new company registrations in 2011/12 suggests that the economy is recovering
- Figure: After an increase in insolvencies in 2011, the second half of 2012 saw a marked improvement
- Figure: Brokers predict small rate increases in SME insurance over the next 12 months
- Figure: The SME insurance market's GWP is forecast to reach over £6.5bn in 2016
- Figure: Liability insurance is the most commonly bought cover by SMEs, followed by property
- Figure: SMEs within the manufacturing industry are the best target for public liability insurance
- Figure: Less than a quarter of SME respondents hold BI insurance
- Figure: Many SMEs depend on key individuals but lack cover for the possibility of their being incapacitated
- Figure: Growth in the direct channel in 2012 has been to the detriment of brokers
- Figure: Damage to business reputation and the risk of data loss are the primary SME fears

Note: Product cover images may vary from those shown
3 of 4

- Business Integration Services Ltd.
- Hutchison 3G UK Limited
- Wolters Kluwer nv

Note: Product cover images may vary from those shown
4 of 4
Note: Product cover images may vary from those shown



Our Clients

  • Transatlantic Holdings, Inc.
  • Aon Plc.
  • Swiss Reinsurance Company Ltd.
  • Prudential Financial, Inc.
  • General Reinsurance Corporation
  • ING Group