UK SME Insurance: Competitor Dynamics 2018

This report looks at which insurers lead the way in the SME segment and how they are developing their propositions. It also highlights 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.

AXA and Aviva dominate the UK SME insurance space across all of the 10 non-vehicle-based commercial products listed in our 2018 UK SME Insurance Survey. However, the pair have slipped within the six motor lines, with Admiral and AA in particular establishing a strong presence at the top of these markets. Meanwhile Allianz recorded a strong performance in the liabilities lines but little impact in the vehicle-based lines. Hiscox and Zurich are liability specialists, although they have both seen their shares decline since 2017. Within the motor lines there is a clear trend of popular personal lines insurers also enjoying success in the SME market. This shows that established relationships are essential and easily transferred from personal to commercial lines.

Scope

- AXA’s domination has declined slightly in terms of individual lines, but it still heads seven products.

- Third-placed Allianz remains over 5 percentage points behind Aviva, which highlights that the top two are still way ahead of other brands despite their declines. But this is offset by Allianz underwriting the products of Barclays, which is the fourth-largest player.

- AXA’s position in the overall market is not replicated in brokers’ preference for business placement, where Allianz and Aviva continue to top packaged and non-packaged respectively.

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.

Companies mentioned

AXA

Aviva

Allianz

Direct Line

Zurich

Hiscox

RSA

NFU Mutual

Lloyds

LV=

AA

Ageas

AIG

ACE

Barclays

Bupa

AXA

Aviva

Allianz

Direct Line

Zurich

Hiscox

RSA

NFU Mutual

Lloyds

LV=

AA

Ageas

AIG

ACE

Barclays

Bupa

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 ...

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 SHAPE OF THE SME MARKET 8

2.1. Introduction 8

2.2. The big three continue to lead the way for packaged broker insurance 8

2.3. Aviva leads non-packaged as the top two pull away 10

3. PRODUCT POSITIONING 12

3.1. AXA remains the leading insurer, but competitors have closed the gap 12

3.2. AXA’s decline saw Aviva challenge for top spot despite its static share 13

3.3. Barclays leads the bancassurance re-emergence 14

3.4. AXA and Aviva are consistent throughout all 16 lines 15

3.5. Hiscox remains a specialist liabilities insurer 16

3.6. Admiral and Direct Line are strong in motor 16

4. TOP FIVE INSURERS BY PRODUCT LINES 18

4.1. Top five players for business interruption insurance 18

4.2. Top five players in directors and officers insurance 19

4.3. Top five players in employers’ liability insurance 20

4.4. Top five players for key man insurance 21

4.5. Top five players for personal accident and business travel insurance 22

4.6. Top five players for property insurance 23

4.7. Top five players for professional indemnity insurance 24

4.8. Top five players for public liability insurance 25

4.9. Top five players for private medical insurance 26

4.10. Top five players for cyber insurance 27

4.11. Top five players for company cars (single) insurance 28

4.12. Top five players for company cars (fleet) insurance 29

4.13. Top five players for company vans (single) insurance 30

4.14. Top five players for company vans (fleet) insurance 31

4.15. Top five players for vehicle: other (single) insurance 32

4.16. Top five players for vehicle: other (fleet) insurance 33

5. KEY PLAYERS 34

5.1. AXA formed partnerships to boost broker offerings 34

5.2. AXA is focusing on Brexit and modern cyber cover 34

5.3. Aviva is targeting independent brokers with new community launch 34

5.4. Zurich is aiming to boost its SME business with new appointment 35

5.5. Hiscox launched a cyber campaign to raise customer awareness 35

5.6. Cyber specialists could threaten mainstream insurers 36

5.7. Digital Risks shows innovation can thrive in the SME sector 37

6. TOP INSURERS BY NET PROMOTOR SCORE 38

6.1. Aviva’s impressive NPS could help it challenge AXA at the top of the market 38

6.2. The leading insurers saw strong improvements in NPS in 2018 41

7. APPENDIX 42

7.1. Abbreviations and acronyms 42

7.2. SME 42

7.3. Methodology 43

7.3.1. GlobalData’s 2018 UK SME Insurance Survey 43

7.3.2. GlobalData’s 2018 UK Commercial Broker Survey 43

7.4. Bibliography 43

7.5. Further reading 44

List of Tables

List of Tables

Table 1: Market share of packaged SME insurance, 2014-18 9

Table 2: Market share of non-packaged SME insurance, 2014-18 11

Table 3 ...

List of Tables

Table 1: Market share of packaged SME insurance, 2014-18 9

Table 2: Market share of non-packaged SME insurance, 2014-18 11

Table 3: Top three players’ shares across each product line, 2018 17

Table 4: Breakdown of business interruption insurance market shares by size category, 2018 18

Table 5: Breakdown of directors and officers insurance market shares by size category, 2018 19

Table 6: Breakdown of employers’ liability insurance market shares by size category, 2018 20

Table 7: Breakdown of key man insurance market shares by size category, 2018 21

Table 8: Breakdown of personal accident and business travel insurance market shares by size category, 2018 22

Table 9: Breakdown of property insurance market shares by size category, 2018 23

Table 10: Breakdown of professional indemnity insurance market shares by size category, 2018 24

Table 11: Breakdown of public liability insurance market shares by size category, 2018 25

Table 12: Breakdown of private medical insurance market shares by size category, 2018 26

Table 13: Breakdown of cyber insurance market shares by size category, 2018 27

Table 14: Breakdown of commercial motor - company car (single) market shares by size category, 2018 28

Table 15: Breakdown of commercial motor - company car (fleet) market shares by size category, 2018 29

Table 16: Breakdown of commercial motor - van (single) market shares by size category, 2018 30

Table 17: Breakdown of commercial motor - van (fleet) market shares by size category, 2018 31

Table 18: Breakdown of other commercial motor (single) market shares by size category, 2018 32

Table 19: Breakdown of other commercial motor (fleet) market shares by size category, 2018 33

Table 20: Customer satisfaction among leading insurers in selected lines, 2018 41

Table 21: NPS for leading insurers across key product lines, 2017-18 41

List of Figures

List of Figures

Figure 1: The top three for SME business placement pulled away from their competitors in 2018 9

Figure 2: Aviva continues to ...

List of Figures

Figure 1: The top three for SME business placement pulled away from their competitors in 2018 9

Figure 2: Aviva continues to lead the market for non-packaged insurance 10

Figure 3: AA and Aviva have eaten into AXA’s dominance 12

Figure 4: Aviva cut into AXA’s lead as Barclays and Direct Line replaced Zurich and Hiscox 14

Figure 5: Barclays’ strong presence among SMEs gives it a platform to sell insurance 15

Figure 6: AXA leads the way for business interruption as Zurich and Hiscox dropped out of the top five 18

Figure 7: Ageas replaced Zurich in the top five as shares saw little change in 2018 19

Figure 8: Aviva closed the gap on AXA as Barclays replaced Hiscox in the top five 20

Figure 9: Aviva closed the gap on AXA to share market leader position for key man insurance 21

Figure 10: AXA and Aviva remain clear of competitors in personal accident and business travel insurance 22

Figure 11: Aviva recorded strong growth to overtake AXA in property insurance 23

Figure 12: AXA extended its lead in the professional indemnity market as the top five remained the same 24

Figure 13: Aviva closed the gap on AXA in public liability as other competitors fell away 25

Figure 14: Bupa’s share declined by 8.9pp, with AXA now a close second 26

Figure 15: The top three cyber insurance players account for over a third of the market 27

Figure 16: AA rose from outside the top five in 2017 to lead the market in 2018 28

Figure 17: Admiral and AA showed strong growth to join Aviva at the top of the market 29

Figure 18: AA and Admiral overtook AXA and Aviva to lead the market in 2018 30

Figure 19: Strong growth from AA saw it challenge Aviva in 2018 31

Figure 20: AA overtook Aviva, which fell to fourth place in 2018 32

Figure 21: Strong growth from Admiral saw it overtake NFU Mutual and AXA 33

Figure 22: Hiscox set out to educate customers on the frequency and dangers of cyber attacks 36

Figure 23: Aviva’s challenge to AXA will be boosted by its excellent customer relationships 39

Figure 24: The three leading insurers all received positive feedback across the four lines 40

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