United Kingdom (UK) Commercial Property Insurance Market Trends, Competitor Dynamics and Opportunities
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The gross written premium (GWP) in the UK commercial property insurance market was valued at GBP12.2 billion in 2022. The commercial property insurance market in the UK is predicted to expand gradually at a CAGR of more than 4% from 2022 to 27. It is projected that factors such as rising repair costs and hardening market rates will fuel premium increases in the coming years.
UK Commercial Property Insurance Market Outlook 2022-2027 (GBP Billion)
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The UK commercial property insurance market research report analyzes the property insurance scenario within the commercial insurance market and how it is influenced by volatility in the economy. It also ascertains how newcomers and insurtechs are disrupting and driving innovation in the country’s insurance industry. The report enables clients to identify the impact of Brexit and the effects of the cost-of-living crisis on the UK commercial property insurance space. Furthermore, the report’s outlook presents growth opportunities in the property insurance space as well as challenges faced by the insurance providers.
GWP (2022) | GBP12.2 billion |
CAGR (2022-2027) | >4% |
Key Players | · Aviva
· AIG · Zurich · AXA · Allianz |
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UK Commercial Property Insurance Market Dynamics
The UK commercial property insurance GWP increased by 18.5% in 2022 when compared to 2021. This growth can be attributed to the ongoing inflationary pressures and increased rebuild costs because of supply chain disruptions. 2021 was a particularly bad year for claims. As a result, insurers increased premiums to offset claims costs and avoid further losses. Furthermore, the rising cost of building supplies, due to supply chain disruptions caused by the pandemic and the Ukraine-Russia conflict, affected the costs of rebuilding and necessitated more extensive insurance coverage.
The construction industry continues to have a significant impact on the performance of the commercial property insurance market in the UK. Additionally, the post-Brexit landscape and the Russia–Ukraine dispute will have a profound effect on the property insurance industry in the UK.
Furthermore, the incidence of underinsured properties remains a concern in the UK as it highlights a rising discrepancy between actual rebuilding costs and the coverage offered by insurance plans. Commercial insurers must warn businesses about the difficulties that underinsurance, whether intentional or unintentional, can cause during the claims process. Nevertheless, the underinsurance gap appears to be closing, thereby increasing the GWP in the coming years.
UK Commercial Property Insurance Market – Growth Opportunities
According to GlobalData’s 2022 and 2023 UK SME Insurance Survey data, around 11.0% of SMEs have switched insurance providers in 2023, due to pricing considerations, underscoring the financial difficulties that businesses are facing. The price volatility of materials and the rising costs of labor will further influence the completion of construction projects, resulting in delays and added costs in a market that is already unstable. Despite this, the UK commercial property insurance market is predicted to expand gradually during the forecast period. The rising repair costs and hardening market rates will drive premium increases over the next five years.
Moreover, sustainable material underwriting will become more relevant as the nation attempts to reach net-zero emissions. Insurers should accommodate the changing construction landscape by properly underwriting these sustainable materials to remain competitive in the market. Aviva has already targeted this through its recent initiative that caters to the underwriting of engineered timber.
Additionally, technological improvements and the use of satellite data will help insurers to manage claims effectively, by foreseeing possible chances of property damage from calamities such as floods, and hurricanes, thereby offering quick financial help for repairs. This prompt handling of claims can increase client loyalty. Also, AI-driven services will enable insurers to increase the accuracy of risk profiling and deliver personalized, real-time customer support, in addition to improving customer experience, lowering operating costs, and streamlining procedures.
UK Commercial Property Insurance Market – Competitive Landscape
A few of the leading insurers operating in the UK commercial Property insurance market are Aviva, AIG, Allianz, Zurich, and AXA among others. In 2022, Aviva remains the top provider of commercial property insurance in the UK, followed by AIG and Zurich.
UK Commercial Property Insurance Market Analysis, by Key Players
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Scope
• The UK commercial property insurance market is expected to grow by 9.1% to GBP13.3 million in 2023, following an 18.5% growth in 2022.
• Gross claims incurred declined by 16.4% in 2022, driven particularly by a significant 48.3% decrease in BI claims.
• There was a 5.8% drop in claims notified, from 173,000 to 163,000, which helped to lower the total value of claims incurred.
• Aviva holds its position as market leader with a 12.3% share of the market. It is expected to increase its share in 2023 courtesy of it now being able to underwrite engineered timber, showing its dedication to environmental, social, and governance (ESG) initiatives.
Reasons to Buy
- Analyze the drivers of growth within the UK commercial property market.
- Determine areas of concern for insurers and the wider market, including in the claims landscape.
- Recognize the impact of Brexit, the cost-of-living crisis, and inflation on the market.
- Ascertain the market shares of the leading players.
- Examine future opportunities and challenges within the market.
AIG
Zurich
AXA
Allianz
Munich Re
RSA
Chubb
NFU Mutual
Direct Line
Knight Frank
Savills
Winterflood
Cluttons
Willis Towers Watson
Ageas
JPMorgan
Intelligent AI
Arturo
ICEYE
Maptycs
Zesty.ai
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Frequently asked questions
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What was the UK commercial property insurance GWP in 2022?
The UK commercial property insurance GWP was valued at GBP12.2 billion in 2022.
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What is the expected UK commercial property insurance market growth rate for the forecast period?
The UK commercial property insurance market is expected to grow at a CAGR of more than 4% during 2022-2027.
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Which are the key players in the UK commercial property insurance market?
A few of the leading insurers operating in the UK commercial Property insurance market are Aviva, AIG, Allianz, Zurich, and AXA among others.
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Which player leads in the UK commercial property insurance market?
Aviva accounted for the highest share of the UK commercial property insurance market in 2022.
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