United Kingdom (UK) Commercial Property Insurance Market Size, Trends, Competitor Dynamics and Opportunities
UK Commercial Property Insurance Market Report Overview
The gross written premium of the United Kingdom (UK) commercial property insurance market was GBP9 billion in 2021 and is expected to achieve a CAGR of more than 3% during 2021-2026. In the upcoming years, hardening market rates and claims inflation will contribute to robust premium growth, strong business retention rates, and potential new business growth.
The UK commercial property insurance market research report analyzes the commercial property insurance market in the UK, looking at drivers of uptake across different demographics and dwelling types. It discusses the claims landscape in 2021, as well as the commercial property market across London and upcoming regulatory changes within insurance. Incumbent competitors are analyzed and compared, along with newcomers and insurtechs within the space. Future impactors in the market are also examined, including climate change, underinsurance, and the changing office environment.
UK Commercial Property Insurance Market Outlook 2021-2026 (GBP Billion)
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UK Commercial Property Insurance Market Dynamics
Drones are being used in the commercial property sector for claim processing, damage assessment, data collecting and analysis, inspection and site evaluation, and fraud prevention. Due to their potential to deliver faster and safer services when analyzing losses compared to human inspections, drones can evaluate broad areas that are challenging to access. Drones will speed up inspections, allowing insurance companies to perform more evaluations and appraisals each day.
Many products now cost more in the UK because of Brexit, the Russia-Ukraine conflict, and challenges with the global supply chain. The rising cost of construction is driving up the cost of rebuilding many properties. The rising cost of imports in the UK will also have an impact on commercial buildings that house inventory or specialized gear. Numerous current insurance policies on the market are no longer adequate to cover the full costs to businesses of this repair due to the additional time and expense required to replace damaged merchandise or apparatus (or even to rebuild premises themselves). If policies are not consistently updated to reflect price rises, insurers risk losing out on significant premium income and unintentionally underinsuring many firms.
UK Commercial Property Insurance Market Segmentation by Claims Type
The key gross claims type in the UK commercial property insurance market includes fire and explosion, escape of water, weather, business interruption, theft of money, and other theft. Weather-related losses and losses due to fires and the subsequent property damage caused are the two biggest threats to the market. Weather-related losses have been a recurring danger for the property sector over the last two years, with reports of close to GBP500 million in losses. This has put pressure on profitability. It should be emphasized that the commercial property insurance market has very narrow profit margins.
UK Commercial Property Insurance Market Analysis by Claims Type, 2021 (%)
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UK Commercial Property Insurance Market - Competitive Landscape
Some of the leading commercial property insurers in the UK are Aviva, Zurich, AIG, Allianz, AXA, Munich Re, RSA, NFU Mutual, Chubb, and Direct Line Group. In terms of commercial property, Aviva had another good year in 2021, retaining its position as the market leader. This rise has been fueled by better underwriting performance as well as fewer claims associated with COVID-19, according to its 2021 annual report.
UK Commercial Property Insurance Market Analysis by Property Insurers, 2021 (%)
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UK Commercial Property Insurance Market Report Overview
|Market Size (GWP 2021)||GBP9 billion|
|Claim Types||Fire and Explosion, Escape of Water, Weather, Business Interruption, Theft of Money, and Other Theft|
|Leading Commercial Property Insurers||Aviva, Zurich, AIG, Allianz, AXA, Munich Re, RSA, NFU Mutual, Chubb, and Direct Line Group|
Segments Covered in the Report
UK Commercial Property Insurance Claims Type Outlook (Value, GBP Billion, 2021-2026)
- Fire and Explosion
- Escape of Water
- Business Interruption
- Theft of Money
- Other Theft
This report provides:
- Analysis of the UK commercial property insurance market
- Drivers of uptake across different demographics and dwelling types
- Claims landscape in 2020, as well as the commercial property market across London and upcoming regulatory changes within insurance
- Analysis and comparison of competitors, along with newcomers and insurtechs within the space
- Future impacts on the market including climate change, underinsurance, and the changing office environment
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 and inflation on the market.
- Ascertain the market shares of the leading players.
- Examine future opportunities and challenges within the market.
Direct Line Group
Legal & General
Table of Contents
- 1 Executive Summary
- 1.1 Market overview
- 1.2 Key findings
- 1.3 Critical success factors
- 2 Market Dynamics
- 2.1 The UK commercial property market grew significantly in 2021
- 2.2 The year 2021 was expensive for commercial property claims
- 2.3 The construction sector resumes in 2021, recovering from 2020
- 2.4 Investment in London experienced the largest increase since 2017
- 2.5 Tax incentives and regulations have an impact on people’s investment in commercial property
- 2.6 More commercial-to-residential conversions will occur as housing demand rises and towns level up
- 3 Competitor Dynamics
- 3.1 Aviva is still the market leader by some distance
- 4 The Market Going Forward
- 4.1 Commercial property insurance will grow to GBP10.8 billion in 2026
- 4.2 Brexit and COVID-19 will make for a harder recovery for the construction industry than first thought
- 4.3 Underinsurance problems are exacerbated by global supply-side issues
- 4.4 ESG initiatives will present opportunities and difficulties for insurers
- 4.5 Technology is becoming more valuable to commercial property insurers
- 4.6 The changing landscape of office working represents an opportunity for insurers
- 5 Appendix
- 5.1 Abbreviations and acronyms
- 5.2 Methodology
- 5.3 Secondary sources
- 5.4 Further reading
- About GlobalData
- Contact Us
List of Tables
List of Tables
Table 1: UK commercial property insurance market GWP and growth rate, 2017-21
Table 2: Gross claims paid (GBP million), by type, 2017-21
Table 3: Number of claims notified (000s), by type, 2017-21
Table 4: UK commercial construction output, 2021-26f
Table 5: Construction output, non-seasonally adjusted, current prices by sector (GBP billion), 2017-21
Table 6: Competitor market shares and GWP, 2019-21
List of Figures
List of Figures
Figure 1: The UK commercial property insurance market grew considerably in 2021
Figure 2: Weather-related gross claims paid grew by the fastest rate in 2021
Figure 3: Weather and Fire & Explosion claims both spiked in 2021
Figure 4: Fire & Explosion was the only claim category to increase in 2021
Figure 5: Construction is expected to bounce back after 2020 and continue to grow
Figure 6: The rate for buy-to-let mortgages remained low, but only because there were more mortgages overall in 2021
Figure 7: The population of the UK is still steadily increasing
Figure 8: Aviva continues to lead the commercial property market
Figure 9: Until 2026, the UK market for commercial property insurance is anticipated to grow annually
Figure 10: Concerns about underinsurance plague more than a third of SMEs with commercial property insurance
Figure 11: After the pandemic, more than half of employees do not anticipate returning to work full-time
Figure 12: Only 20.3% of individuals expect to work full-time at the office post-pandemic, with the majority taking a hybrid approach
Figure 13: Forecasting methodology
Frequently Asked Questions
The gross written premium of the UK commercial property insurance market was GBP9 billion in 2021.
The UK commercial property insurance market is expected to grow at a CAGR of more than 3% during 2021-2026.
The key claims types in the UK commercial property insurance market include fire and explosion, escape of water, weather, business interruption, theft of money, and other theft.
Some of the leading commercial property insurers in the UK commercial property insurance market are Aviva, Zurich, AIG, Allianz, AXA, Munich Re, RSA, NFU Mutual, Chubb, and Direct Line Group.
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