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Market Research Report

UK SME Insurance: Competitor Dynamics 2017

Published by GlobalData Product code 379799
Published Content info 44 Pages
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UK SME Insurance: Competitor Dynamics 2017
Published: October 23, 2017 Content info: 44 Pages
Description

AXA and Aviva dominate the SME insurance space across the vast majority of the 16 commercial products listed in our 2017 UK SME Insurance Survey. Other insurers present in the market play to their strengths when servicing SMEs. Hiscox and Zurich are popular providers for liability products while Allianz and Direct Line are strong in commercial motor insurance. As the number of providers supplying SME insurance grows; and there is more choice available to potential customers - those offering the best deals in the terms of the level of cover, the quality of the overall package, price, and (for the micro space in particular) omni-channel availability are most likely to succeed.

Out of the 16 lines of insurance, AXA and Aviva came first and second in most lines, with either one of the two appearing as most selected brand in 14. Bupa's top position in private medical insurance and NFU Mutual's in commercial motor coaches/farm vehicles (fleet) are the only exceptions. AXA is market leader in 10 out of the 16 lines, while Aviva leads in four - all of which were forms of commercial motor insurance. The main theme at the top of the market is the slow fade of AXA's dominance. While it has remained the largest player in most lines within our survey, its leading margin has been gradually declining over the past three years.

Key Findings included in this report -

  • AXA dominates in terms of individual lines, but its overall market share has taken a substantial hit, falling by 7.5 percentage points (pp) to 13.9% in 2017. This has allowed Aviva to close the gap, despite its share also falling.
  • Third-placed Allianz remains over 5pp behind Aviva, which highlights that the top two are still way ahead of other brands despite their declines.
  • AXA's position in the overall market is not replicated in brokers' preference for business placement, where Allianz and Aviva topped packaged and non-packaged insurance respectively.

SMEs are increasingly worried about the impact of a cyber-attack, according to our UK SME Insurance Survey. This is no surprise, given the regularity of high-profile attacks in the news and the General Data Protection Regulation (GDPR) coming into force in May 2018. But insurers have found the cyber market tough to master, and the take-up has slowed after two consecutive years of growth prior to 2016. The current low penetration level means cyber insurance represents a substantial opportunity for insurers.

The report "UK SME Insurance: Competitor Dynamics 2017", looks at which insurers lead the way in the SME segment and how they are developing their propositions, as well as highlighting how competitor positions vary between micro, small, and medium enterprises. It examines which insurers are winning over brokers and which companies SMEs are placing their business with.

Companies mentioned in this report: AXA, Aviva, Allianz, Direct Line, Zurich, Hiscox, RSA, NFU Mutual, Lloyds, Travelers, LV=, AA

Scope

  • AXA and Aviva lead the SME insurance space, with 13.9% and 11.3% of SMEs respectively holding a commercial insurance policy with these providers.
  • AXA remains dominant across the 16 product lines, but Aviva is closing the gap.
  • Brokers place the most SME business with Allianz, Aviva, and AXA.

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.
  • Adapt your distribution strategy to ensure it is efficient and still meets customer purchasing behavior.
Table of Contents
Product Code: FS0076IA

Table of Contents

Table of Contents

  • 1. EXECUTIVE SUMMARY 2
  • 1.1. AXA and Aviva continue to lead the market 2
  • 1.2. Key findings 2
  • 1.3. Critical success factors 2
  • 2. THE SME MARKET AND ITS LEADING COMPETITORS 7
  • 2.1. Introduction 7
  • 2.2. Allianz and Aviva continue to lead the way for brokers 7
  • 2.3. Aviva's dominance in non-packaged insurance has been challenged 9
  • 2.4. The increasing focus on cybercrime is an opportunity for insurers 11
  • 2.4.1. Some insurers are looking to innovate to gain an edge in a tough market 11
  • 2.5. The key players 12
  • 2.5.1. AXA is looking into its commercial motor offering 12
  • 2.5.2. Aviva revamps cyber cover 13
  • 2.5.3. Allianz focuses on Brexit 13
  • 2.5.4. Hiscox embraces technology 13
  • 2.5.5. Zurich targets education 13
  • 2.6. Technology is emerging in the market 14
  • 2.6.1. New entrants are rare, but the Financial Conduct Authority sandbox is showing promise 15
  • 3. PRODUCT POSITIONING 16
  • 3.1. AXA is the dominant insurer, but Aviva is closing the gap 16
  • 3.1.1. Aviva performs well in commercial motor lines, while Allianz is popular with larger SMEs 17
  • 3.1.2. Hiscox is popular in non-motor lines 18
  • 3.1.3. Direct Line remains strong in motor lines 19
  • 3.1.4. NFU Mutual is strong in niche commercial motor lines 19
  • 4. NPS 37
  • 4.1. Hiscox has the edge in customer satisfaction 37
  • 5. APPENDIX 41
  • 5.1. Abbreviations and acronyms 41
  • 5.2. SME 41
  • 5.3. Methodology 42
  • 5.3.1. GlobalData's 2017 UK SME Insurance Survey 42
  • 5.3.2. GlobalData's 2017 UK Commercial Broker Survey 42
  • 5.4. Bibliography 42

List of Tables

List of Tables

  • Table 1: Market share of packaged SME insurance, 2013-17 9
  • Table 2: Market share of non-packaged SME insurance, 2013-17 10
  • Table 3: Full breakdown of the leading five insurers across all lines, 2017 20
  • Table 4: Top five insurers for business interruption insurance, 2017 21
  • Table 5: Top five insurers for directors and officers insurance, 2017 22
  • Table 6: Top five insurers for employers' liability insurance, 2017 23
  • Table 7: Top five insurers for key man insurance, 2017 24
  • Table 8: Top five insurers for personal accident and business travel insurance, 2017 25
  • Table 9: Top five insurers for property insurance, 2017 26
  • Table 10: Top five insurers for professional indemnity insurance, 2017 27
  • Table 11: Top five insurers for public liability insurance, 2017 28
  • Table 12: Top five insurers for private medical insurance, 2017 29
  • Table 13: Top five insurers for cyber insurance, 2017 30
  • Table 14: Top five insurers for commercial motor: company car (single), 2017 31
  • Table 15: Top five insurers for commercial motor: company car (fleet), 2017 32
  • Table 16: Top five insurers for commercial motor: van (single), 2017 33
  • Table 17: Top five insurers for commercial motor: van (fleet), 2017 34
  • Table 18: Top five insurers for other commercial motor e.g. coaches/farm vehicles (single), 2017 35
  • Table 19: Top five insurers for other commercial motor e.g. coaches/ farm vehicles (fleet), 2017 36
  • Table 20: Customer satisfaction among leading insurers in selected lines, 2017 39
  • Table 21: Leading insurers' NPS for selected lines, 2017 40

List of Figures

List of Figures

  • Figure 1: Allianz continues to lead Aviva in terms of broker preference for packaged SME insurance 8
  • Figure 2: Aviva leads the way in non-packaged SME insurance 10
  • Figure 3: AXA leads the way in more than half of SME insurance lines 14
  • Figure 4: AXA remains the leading insurer, while Hiscox has overtaken Zurich 17
  • Figure 5: AXA leads the way for business interruption insurance 21
  • Figure 6: AXA still leads the way for directors and officers liability, but Aviva has closed the gap 22
  • Figure 7: Hiscox has climbed to third place in employers' liability, overtaking Allianz 23
  • Figure 8: Aviva has eaten into AXA's lead, with the top two remaining dominant in key man insurance 24
  • Figure 9: Aviva, Allianz, and Zurich have reduced AXA's lead in personal accident and business travel 25
  • Figure 10: Allianz has overtaken Zurich in property insurance 26
  • Figure 11: Hiscox is very competitive in the professional indemnity market 27
  • Figure 12: Little change has been witnessed among the top three public liability insurers 28
  • Figure 13: Despite AXA's gains, Bupa's lead in private medical remains substantial 29
  • Figure 14: Allianz and AA displaced AIG and Zurich in the cyber insurance top five 30
  • Figure 15: Aviva has pulled away from AXA in single car insurance 31
  • Figure 16: Aviva has drawn level with AXA in company car fleet insurance 32
  • Figure 17: AA entered the top three for single van insurance 33
  • Figure 18: Aviva leads van fleet insurance, with Admiral entering the top five 34
  • Figure 19: Aviva now leads in single coaches and farm vehicles insurance 35
  • Figure 20: NFU Mutual jumped to first place for fleet coaches and farm vehicles 36
  • Figure 21: Hiscox receives positive feedback from customers, while AXA is heavily criticized 38
  • Figure 22: AXA and Allianz are struggling to keep customers happy 40
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