UK Commercial Insurance Distribution 2018

  • ID: 4516256
  • Report
  • Region: United Kingdom, Great Britain
  • 49 pages
  • GlobalData
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FEATURED COMPANIES

  • AA
  • AXA
  • CoverBuilder
  • Insurance Times
  • Marsh
  • RBS
  • MORE
UK Commercial Insurance Distribution 2018

Summary

"UK Commercial Insurance Distribution 2018", report provides an in-depth study into commercial insurance distribution trends. It discusses the influence of the different purchasing behaviors of SMEs compared to larger corporate businesses, and pays particular attention to the role and strategy of brokers within product distribution. It also addresses challenges in the market and the impact of technology on consumer channel preferences, before concluding with a distribution forecast for the coming years.

Commercial insurance remains a highly competitive space, and the distribution of the market’s products continues to evolve. Brokers maintain a grip on the greatest share of the market, and the channel’s footprint saw a rise in premium share in 2016 according to Association for British Insurers (ABI) statistics. With enduring dominance in non-SME markets and fast-flow business, digital brokers are finding success even against the threat of the direct channel in the SME space.

Scope
  • Brokers dominate the distribution of commercial insurance with a 79.0% share of the market.
  • The broker landscape has been transformed by digital offerings via price comparison sites and innovative players.
  • Acquisitions were a key trend in 2017, with consolidation a priority for brokers and insurers amid tough conditions.
Reasons to buy
  • Adapt your distribution strategy to ensure it still meets the needs of clients and intermediaries.
  • Ensure you remain competitive as new innovations revolutionize the purchasing journey for clients and brokers.
  • Benchmark yourself against other players in the market.
  • Be prepared for how technology is set to impact the commercial insurance market.
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FEATURED COMPANIES

  • AA
  • AXA
  • CoverBuilder
  • Insurance Times
  • Marsh
  • RBS
  • MORE
1. EXECUTIVE SUMMARY
1.1. Brokers dominate as the direct channel’s share falls
1.2. Key findings
1.3. Critical success factors

2. CHANNEL ANALYSIS
2.1. Introduction
2.2. Key regulatory updates
2.3. Brokers continue to dominate, and are fighting back in the SME space
2.3.1. Price comparison sites expand SME insurance at the expense of traditional brokers
2.3.2. Banks and building societies saw a steady decline in market share
2.4. Commercial insurance distribution within the direct channel
2.4.1. Brokers continue to control commercial insurance
2.4.2. AXA and Aviva dominate the increasingly digital SME market
2.4.3. AXA buys XL to boost its commercial offering
2.4.4. Simply Business leads the success of e-brokers in the SME market
2.4.5. Zurich and Hiscox find tech partners for innovative SME insurance
2.5. Retailers/affinity groups and commercial insurance
2.5.1. Affinity providers target SMEs with commercial insurance products
2.6. Banking providers and the distribution of commercial insurance
2.6.1. Banks and building societies are used the least to purchase commercial policies

3. BROKERS AND COMMERCIAL INSURANCE DISTRIBUTION
3.1. The broker landscape is dominated by five global firms
3.2. Global brokers retain the largest share of commercial revenues
3.2.1. The top five brokers accounted for around 28.7% of the total market in 2017
3.2.2. Marsh overtakes JLT
3.2.3. JLT falls to second place
3.2.4. Arthur J. Gallagher improves to third position
3.2.5. Willis moves back into fourth after Towers Watson Merger
3.2.6. Aon falls to fifth following strong growth from rivals
3.3. Common themes emerge from the growth strategies of brokers
3.3.1. Brokers look to facilitate growth through cross-selling and upselling
3.3.2. Acquisitions are high on the agenda of national brokers
3.3.3. Brokers are warming to the use of social media
3.3.4. Provincial brokers keep the focus on traditional methods but seek to develop online channels
3.3.5. Super-regionals are prioritizing social media engagement
3.3.6. National brokers are looking to enhance their online propositions

4. THE DISTRIBUTION LANDSCAPE GOING FORWARD
4.1. Innovation is creeping into the commercial sector
4.1.1. Commercial lines carriers are set to benefit from the introduction of blockchain
4.1.2. E-trading is becoming the norm in commercial insurance
4.1.3. AXA agrees deal with Brolly
4.1.4. Gig economy insurance emerges as the sector continues to grow
4.1.5. AI-driven commercial insurance tech company raises £4.4m
4.2. How will the distribution landscape change in the coming years?
4.2.1. Growth in the commercial market stems from SME insurance
4.2.2. The continued growth of digital brokers will cut into traditional brokers and direct channels

5. APPENDIX
5.1. Abbreviations and acronyms
5.2. Definitions
5.2.1. Brokers
5.2.2. Direct
5.2.3. SME
5.3. Methodology
5.3.1. 2017 UK SME Insurance Survey
5.3.2. 2018 UK Commercial Broker Survey
5.4. Bibliography
5.5. Further reading

List of Tables
Table 1: The top five direct insurers (by percentage of SME respondents), 2017
Table 2: Leading UK banks and their business insurance providers
Table 3: Expansion strategies for brokers
Table 4: Broker business growth strategies, percentage point movement, 2016-17
Table 5: SME and non-SME GWP splits, 2016-21f
Table 6: Share of commercial insurance distribution by channel (%), 2016-22f

List of Figures
Figure 1: The broker channel increased its share after years of decline
Figure 2: Online channels continued to grow in 2017
Figure 3: The majority of medium enterprises still use the broker channel
Figure 4: The direct channel’s share of commercial insurance is on the decline
Figure 5: Direct channel GWP rose in 2017, despite a decline in market share
Figure 6: AXA’s acquisition of XL is not expected to hugely impact its presence in the UK market
Figure 7: The affinity channel’s share of commercial insurance has been on the rise
Figure 8: GWP within the affinity channel exceeded £500m in 2015
Figure 9: The bank channel accounts for a tiny proportion of the overall market
Figure 10: The bank channel saw slight GWP growth in 2017 after consecutive declines
Figure 11: Marsh overtook JLT as the leading broker
Figure 12: Cross-selling/upselling and increased marketing remain the most popular expansion strategies
Figure 13: National brokers look to acquisition and geographic expansion
Figure 14: Social media adoption has seen substantial growth
Figure 15: Provincial brokers mostly embrace features associated with traditional insurance broking
Figure 16: Super-regional brokers have the highest adoption of social media to engage clients
Figure 17: National brokers are looking to improve their use of social media as an engagement tool
Figure 18: The commercial sector is set to see growth up to 2022
Figure 19: Brokers’ share will continue to grow as the direct channel declines
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  • AXA
  • Hiscox
  • NFU Mutual
  • Aviva
  • Allianz
  • Simply Business
  • HSBC
  • Santander
  • Lloyds
  • RBS
  • TSB
  • Towergate
  • Confused.com
  • Comparethemarket.com
  • Moneysupermarket.com
  • Gocompare.com
  • Zurich
  • Barclays
  • Lloyds Bank
  • Arthur J. Gallagher
  • JLT
  • Marsh
  • Aon
  • Willis
  • AA
  • Saga
  • Tower Watson
  • Jelf
  • Insurance Times
  • Willis Tower Watson
  • Nimbla
  • Polaris
  • Brolly
  • CoverBuilder
  • Cytora
Note: Product cover images may vary from those shown
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