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.
Brokers remain the most popular channel for SMEs when purchasing insurance, accounting for 47.0% of policies sold. After a decline in 2021. Direct sales retained their spot as the second most popular channel in 2022. However, this was a decline on a strong 2021, while banks regained some of their market share to take third place. Across all segments, online is the favored channel for purchases with 49.4% of policies bought online. Auto-renewals continued to decline in 2022, accounting for 26.8% of sales and highlighting that businesses are increasingly cost-conscious amid the tough economic environment. This means retention will be harder but also that there are greater opportunities for customer acquisition.
Brokers remain the most popular channel for SMEs when purchasing insurance, accounting for 47.0% of policies sold. After a decline in 2021. Direct sales retained their spot as the second most popular channel in 2022. However, this was a decline on a strong 2021, while banks regained some of their market share to take third place. Across all segments, online is the favored channel for purchases with 49.4% of policies bought online. Auto-renewals continued to decline in 2022, accounting for 26.8% of sales and highlighting that businesses are increasingly cost-conscious amid the tough economic environment. This means retention will be harder but also that there are greater opportunities for customer acquisition.
Scope
- An average of 67.7% of SMEs plan to stay with their current provider and coverage. However, this varies significantly according to the size of the company, with medium businesses most at risk of switching.
- Across the micro, small, and medium business segments, commercial vehicle policies are most likely to be under review. For example, 58.7% of medium businesses are considering making changes to single van policies. In the sole trader segment, companies are most likely to be assessing their business interruption cover, with 5.1% considering canceling it and 8.9% looking to switch provider.
Reasons to Buy
- Understand trends in the UK SME insurance market.
- Learn how SMEs like to purchase insurance products and the factors influencing why they choose channels and methods.
- Identify how market trends and macroeconomic factors impact decision-making.
Table of Contents
- Executive Summary
- Critical Success Factors
- The UK SME Landscape
- Purchasing Channels
- Provider Selection and Customer Retention
- Future Switching and Cancellations
- Appendix
