Home / International / Flexibility seen as key to UK motor insurersí recovery
14 December 2020
UK commercial motor insurers can regain businesses that were lost this year to the pandemic disruption if they make an effort to be more flexible with their offerings, according to consultancy GlobalData.
The analyst made the assessment after its SME insurance survey found motor lines were the most affected by the COVID-19 economic fallout.
Out of 20 products SMEs were asked in the survey, the six most cancelled covers all relate to motor insurance. Single-van insurance policies had the highest cancellation rate at 14.7%.
But GlobalData Insurance Analyst Ben Carey-Evans believes many of the cancellations were temporary, which gives insurers an opportunity to rebuild their books.
“A positive outcome from this is that a lot of these would have been temporary cancellations rather than permanent as businesses were unable to travel, and delivery fleets were more difficult during a year of lockdown and restrictions,” he said.
“Of course, online shopping has surged, and many delivery-type businesses are significantly up, so these insurers who have lost this high level of business may also have picked up new customers or upsold contracts.
“It also means commercial motor insurers will need to be proactive in winning back customers next year as normality slowly returns.
Giving SMEs a better deal will be critical as many of them would be operating with smaller budgets in the coming months.
“With SMEs’ budgets squeezed, the key is likely to be in the value proposition of policies, but much can be said for offering flexibility as well, as uncertainty over future lockdowns and continuing restrictions remains,” Mr Carey-Evans said.