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Market Research Report

UK Household Insurance: Market Dynamics and Opportunities 2018

Published by GlobalData Product code 373275
Published Content info 54 Pages
Delivery time: 1-2 business days
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UK Household Insurance: Market Dynamics and Opportunities 2018
Published: September 11, 2018 Content info: 54 Pages

"UK Household Insurance: Market Dynamics and Opportunities 2018", report provides an in-depth analysis of the UK household insurance market. It looks at market size and performance ratios as well as changes in premiums, claims, contextual and economic factors, regulations, and opportunities. It provides a thorough overview of the market along with future forecasts and analysis of emerging technologies and products.

Competition in the market remains high but conditions have hardened, with gross written premium (GWP) and average annual premiums increasing despite claims incurred declining in 2017. Benign weather conditions throughout 2017 helped insurers maintain profitability, although 2018 has already presented a very different challenge, with two major weather events occurring in the first quarter.

Home insurers continue to assess the implications of smart devices, and leading players such as AXA and Aviva remain focused on finding technology companies and start-ups to partner with to boost their propositions.


  • UK household insurance GWP grew by 2.0% in 2017 to £6.5bn.
  • The percentage of people living in owner-occupied properties increased for the first time since 2004 in Q1 2017, and increases to insurance premium tax (IPT) raised the average premium price.
  • Start-ups continue to enter the market, with simplification a key trend in the industry.
  • Offering easy-to-use policies in simple English over smartphone apps is how start-ups such as Buzzmove and Homelyfe enjoyed early success.

Reasons to buy:

  • Benchmark yourself against the rest of the market.
  • Ensure you remain competitive as new innovations and insurance models begin to enter the market.
  • Be prepared for how regulation will impact the household insurance market over the next few years.
Table of Contents
Product Code: FS0153IA

Table of Contents


  • 1.1. Market summary
  • 1.2. Key findings
  • 1.3. Critical success factors


  • 2.1. Introduction
  • 2.2. Market conditions hardened slightly in 2017
    • 2.2.1. UK household insurance GWP grew by 2.0% in 2017
    • 2.2.2. Premium rate rises were seen in 2017 for the first time in some years
    • 2.2.3. The requirement for insurers to notify customers on previous price are yet to have the expected impact
    • 2.2.4. Combined cover is still the dominant product
  • 2.3. Industry efforts to stall escape of water have seen profitability rise
    • 2.3.1. Claims costs fell in 2017 as insurers benefited from falling escape of water costs
    • 2.3.2. Claims inflation is challenging profitability
    • 2.3.3. Underwriting profitability has increased to a five-year high
    • 2.3.4. Flood Re launched in 2016 and should help insurers manage difficult 2018 conditions
  • 2.4. Home insurance demand is up slightly as a result of new-builds
    • 2.4.1. New home registrations and completions rose in 2017, but remain significantly below expected levels
    • 2.4.2. Mortgage approval rates dipped slightly in 2017
    • 2.4.3. Owner-occupied property is on the rise, but 'Generation Rent' remains a key theme
    • 2.4.4. Penetration rates are high among owner-occupiers, but lower for tenants


  • 3.1. The top 10 insurers account for 67% of GWP
    • 3.1.1. Direct Line Group leads the household insurance market
    • 3.1.2. Aviva is evolving its proposition using technology
    • 3.1.3. AXA's 'Give Data Back' website looks to educate consumers
    • 3.1.4. AXA has partnered with Brolly
    • 3.1.5. Allianz and LV= link up
    • 3.1.6. Amlin leaves household insurance
    • 3.1.7. UK insurers are watching US digital insurer Lemonade
    • 3.1.8. Bought By Many has partnered with Neos

4. 2018 AND BEYOND

  • 4.1. Introduction
  • 4.2. The market is expected to increase to £6.8bn in GWP by 2023
    • 4.2.1. Significant weather events in early 2018 are likely to shift premiums going forward
    • 4.2.2. The Generation Rent trend could mark a shift in home insurance
    • 4.2.3. The negative economic consequences of Brexit are having an adverse effect
    • 4.2.4. The Insurance Distribution Directive is set to clarify products for consumers
  • 4.3. Generation Rent will drive a new set of products
    • 4.3.1. Demand for propositions aimed at tenants is growing
    • 4.3.2. Urban Jungle targets Generation Rent
    • 4.3.3. Buzzmove capitalizes on movers' home data
    • 4.3.4. Start-ups are focusing on mobile app-enabled policies
    • 4.3.5. Roost targets brokers
  • 4.4. The evolution towards smart home insurance is underway
    • 4.4.1. Water detection and education are essential to reducing escape of water claims
    • 4.4.2. Security a key part of smart homes, as theft costs escalate
    • 4.4.3. Cyber security is an emerging market for individuals
    • 4.4.4. Other devices could help shape the future of the market
  • 4.5. Competition from new startups and retailers is growing
    • 4.5.1. Amazon is on the verge of entering the market
    • 4.5.2. New startups like Neos will continue to disrupt the market


  • 5.1. Abbreviations and acronyms
  • 5.2. Methodology
  • 5.2.1. GlobalData Financial's 2017 UK General Insurance Consumer Survey
  • 5.3. Bibliography
  • 5.4. Further reading

List of Tables

  • Table 1: Household insurance GWP (£m) and annual growth rate (%), 2013-17
  • Table 2: Quarterly average household insurance premium rate movements, 2013-Q1 2018
  • Table 3: The AA Shoparound average home insurance premiums, Q1 2015-Q1 2018
  • Table 4: Household gross claims incurred (£m) by type, and number of claims notified, 2013-17
  • Table 5: New home registrations and completions, 2013-17
  • Table 6: The number of dwellings in England split by category (000s), 2007-17
  • Table 7: Percentage of respondents holding any form of home insurance, 2015-16
  • Table 8: Top 10 UK household insurers by GWP (£000s), 2017
  • Table 9: Number of policies, total GWP, and average premium forecasts to 2023
  • Table 10: UK household insurance GWP and growth rate, 2013-22f
  • Table 11: Percentage of respondents, by type of smart device in their home, 2017
  • Table 12: Percentage of respondents who would buy home insurance by brand/type of company, 2017

List of Figures

  • Figure 1: Household GWP rose in 2017 after four years of decline
  • Figure 2: Buildings insurance premium rates increased strongly at the start of 2018
  • Figure 3: Rate changes have been limited in the past couple of years
  • Figure 4: Combined insurance remains the dominant home insurance product.
  • Figure 5: Weather claims have declined substantially
  • Figure 6: Claims have fallen in all four categories over the past five years
  • Figure 7: Rebuild costs have fluctuated since mid-July
  • Figure 8: The cost of replacing household items has accelerated since 2015
  • Figure 9: Underwriting profitability has increased to its highest level since 2011
  • Figure 10: New registrations and completions both increased in 2017
  • Figure 11: Mortgage approval is in slender decline since the start of 2017
  • Figure 12: Private tenancy has begun to fall slightly after years of growth
  • Figure 13: Nearly 40% of private tenants do not have any home insurance
  • Figure 14: The leading insurers lost market share in 2017
  • Figure 15: AXA allows customers to view the risk of theft and water damage in their postcode
  • Figure 16: Lemonade's platforms are easy to use and understand
  • Figure 17: GWP to grow steadily up to 2023
  • Figure 18: Household insurance will see fluctuation up to 2022
  • Figure 19: Urban Jungle caters for young tenants
  • Figure 20: The Buzzvault app stores details and allows video calls with surveyors
  • Figure 21: Homelyfe aims to sell quick and easy home insurance via its app
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