UK SME Insurance Market Report Overview
The last three years have been challenging for SMEs. The number of businesses fell sharply in 2020, and the decline continued, albeit at a slower pace, in 2021. By the start of 2022, the SME business population was smaller than it was in 2017. However, there are some bright spots. These include the growth of the small business segment over the last year, which lies in contrast to the hit taken by micro-entities and sole traders. From an insurance perspective, the uptake of insurance also appears to have rebounded having declined during the pandemic.
The UK SME insurance market research report identifies which insurers lead the way in the SME segment and examines how they are developing their propositions, while also highlighting how competitor positions vary between micro, small, and medium enterprises. Moreover, it reveals which insurers are winning over brokers and with which companies SMEs are placing their business.
UK SME Insurance Market Dynamics
Though insurance uptake among SMEs has recovered since the pandemic, the current economic challenges mean that SMEs are looking for cost savings, which could include insurance. As the recession is expected to last a long time, insurers must engage with their customers now more than ever to understand their challenges and what this means for their insurance coverage. Taking a proactive approach and conducting mid-term reviews with key clients rather than waiting for renewals is one of the possible options.
UK SME Insurance Market Segmentation by Channels
The key channels in the UK SME insurance market are brokers, banks, PCW, and direct channels. Most of the SME insurance policies were sold through brokers in 2022.
In both the packaged and non-packaged markets, Aviva is the number-one player for brokers. The insurer attributes its strong broker performance in large part to its strong digital offering. In 2018, it launched its digital Broker Community, which attracted a greater number of brokers to its platform by offering live chat features, Fast Trade (Aviva’s e-trading and extranet platform), personal e-services, e-document sections, and guaranteed same-day responses. Most recently, the insurer is allowing brokers to place larger combined risks digitally as well as process routine mid-term adjustments.
UK SME Insurance Market Analysis by Channels, 2022 (%)
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UK SME Insurance Market – Competitive Landscape
The leading providers in the UK SME insurance market are AXA, Aviva, Zurich, NFU Mutual, and Barclays. AXA sold the highest number of contracts in 2022 and was followed by Aviva and Zurich.
AXA: The provider revamped its intermediated SME business and created a dedicated 120-strong team to focus on the SME segment. As part of this revamp, it now offers brokers the chance to place policies online with a self-service option or to work with its team of underwriters where more bespoke solutions are required.
Aviva: Throughout 2022, Aviva has made several announcements related to its SME business. It has also expanded its underwriting capabilities into new areas, notably the high-net-worth (HNW) space, through its acquisitions of AXA XL’s private client business in 2021 and Azur Underwriting. The insurer believes these capabilities will also help in the SME space, with many HNW individuals also being business owners.
Zurich: Zurich appointed Will Edwards as its new head of SME in 2022 and announced its continued intention to drive the growth of Zurich Retail. Within the SME space, Zurich performs particularly well with medium-sized businesses, where it leads the market for nine out of 16 product lines. It also fares well in the small business segment but has a comparatively limited presence in the sole trader and micro-business segments.
UK SME Insurance Market Analysis by Providers, 2022 (%)
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UK SME Insurance Market Report Overview
|Key Channels||Brokers, Banks, PCW, and Direct|
|Leading Providers||AXA, Aviva, Zurich, NFU Mutual, and Barclays|
Segments Covered in the Report
UK SME Insurance Channels Outlook (2018-2022)
Reasons to Buy
- Identify UK SME insurance market leaders.
- Learn the providers of choice for SME insurance among brokers.
- Discover the strategies and Net Promoter Scores of the top SME insurers.
- Identify growth opportunities in the SME space
- Find out which value-added services are in demand.
Table of Contents
- 1 Executive Summary
- 1.1. The leading players have a strong hold on SME insurance, but competition is building behind them
- 1.2. Key findings
- 1.3. Critical success factors
- 2 The UK SME Insurance Landscape
- 2.1. The number of SMEs has declined since the pandemic, but they remain the mainstay of the business landscape
- 2.2. SME insurance uptake: The penetration of most products recovered over 2022
- 2.3. Packaged insurance policies are popular, particularly among small and medium businesses
- 3 The Leading Providers in SME Insurance
- 3.1. The top four providers maintained their market positions in 2022
- 3.2. Leading providers for brokers: Aviva tops broker selection
- 3.3. Leaders in bancassurance: Barclays continues to dominate
- 4 The Top Three SME Insurers: AXA, Aviva, and Zurich
- 4.1. The top three providers’ NPSs vary appreciably by product
- 4.2. AXA: The market leader continued to invest heavily in the UK SME space in 2022
- 4.3. Aviva: The insurer enjoys strong growth of its SME business
- 4.4. Zurich: Seeking growth from the SME segment
- 5 Value-added Services: Understanding Demand
- 5.1. Legal advice is the most accessed service, but the greatest opportunities lie in business strategy and marketing support
- 5.2. The larger the business, the greater the demand for value-added services
- 5.3. The demand for value-added services varies considerably by sector
- 6 Appendix
- 6.1. Supplementary data
- 6.2. Abbreviations and acronyms
- 6.3. Definitions
- 6.4. Methodology
- 6.5. Secondary sources
- 6.6. Further reading
- About GlobalData
- Contact Us
List of Tables
Table 1: The number of SMEs in the UK private sector by business size, 2012–22
Table 2: Top three players’ market shares by product line, 2022
Table 3: The breakdown of NPSs for the top three providers for key products 2022
Table 4: SMEs’ 2022 outlook on value-added services by business size
List of Figures
Figure 1: The uptake of insurance policies by SMEs recovered in 2022
Figure 2: Over 70% of medium businesses bought insurance through a package in 2022
Figure 3: Over 60% of employers’ liability and business interruption policies are bought through a package
Figure 4: AXA, Aviva, and Zurich remain the top three providers of SME insurance
Figure 5: Visually comparing the top five providers for each product demonstrates the dominance of AXA and Aviva
Figure 6: Brokers account for over 45% of SME policy sales
Figure 7: Brokers place the most business for non-packaged SME insurance with Aviva
Figure 8: Brokers place the most business for packaged SME insurance with Aviva
Figure 9: SMEs continue to choose Barclays for SME insurance products over other banks
Figure 10: The top three providers show a mixed performance by product in terms of their NPSs
Figure 11: Legal and financial advice are the most sought-after value-added services
Figure 12: The uptake of legal and financial advice increases with the size of the business
Figure 13: Demand for business strategy advice varies considerably by sector
Figure 14: Top five players’ shares of respondents for 16 different commercial products (sole traders)
Figure 15: Top five players’ shares of respondents for 16 different commercial products (micro-size businesses)
Figure 16: Top five players’ shares of respondents for 16 different commercial products (small-size businesses)
Figure 17: Top five players’ shares of respondents for 16 different commercial products (medium-size businesses)
Frequently Asked Questions
The key channels in the UK SME insurance market are brokers, banks, PCW, and direct channels.
Most of the SME insurance policies were sold through brokers in 2022.
The leading providers in the UK SME insurance market are AXA, Aviva, Zurich, NFU Mutual, and Barclays.
AXA sold the highest number of contracts in the UK SME insurance market in 2022.
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