Insurances - United Kingdom

United Kingdom

The Insurances market in the United Kingdom is projected to reach a market size (gross written premium) of €296.10bn in 2024.
Life insurances dominate the market with a projected market volume of €208.40bn in 2024.
The average spending per capita in the Insurances market amounts to €4.36k in 2024.
In a global comparison, it is shown that the highest nominal value is reached the United States, with €3,477.0bn in 2024.
The gross written premium is expected to show an annual growth rate (CAGR 2024-2029) of -1.28%, resulting in a market volume of €277.60bn by 2029.
In global comparison, the United States will generate the most gross written premium in 2024, with €3,477.0bn.
The United Kingdom's insurance market is experiencing a surge in demand for cyber insurance due to increasing cyber threats.

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Analyst Opinion

The Insurances market in United Kingdom is experiencing a shift in customer preferences, trends, and local special circumstances that are shaping its development.

Customer preferences: Customers in the United Kingdom are increasingly seeking personalized insurance solutions that cater to their specific needs and lifestyles. There is a growing demand for digital insurance services that offer convenience and flexibility, allowing policyholders to manage their insurance coverage easily. Additionally, there is a rising interest in sustainable and socially responsible insurance options, reflecting a broader global trend towards environmental consciousness.

Trends in the market: One of the notable trends in the UK insurance market is the rise of Insurtech companies leveraging technology to streamline processes, enhance customer experience, and offer innovative insurance products. These Insurtech firms are disrupting traditional insurance models and attracting a younger demographic of tech-savvy consumers. Moreover, there is a shift towards usage-based insurance, where premiums are determined by individual behavior or usage patterns, promoting risk prevention and personalized pricing.

Local special circumstances: The regulatory environment in the United Kingdom plays a significant role in shaping the insurance market. With a robust regulatory framework and consumer protection measures in place, insurers are required to meet stringent standards, ensuring transparency and fair treatment of policyholders. Brexit has also introduced uncertainties and challenges for insurance companies operating in the UK, leading to a reevaluation of business strategies and distribution channels to navigate the changing landscape.

Underlying macroeconomic factors: Economic factors such as interest rates, inflation, and GDP growth have a direct impact on the insurance market in the United Kingdom. Low-interest rates may pressure insurers' investment returns, prompting them to adjust pricing strategies and product offerings. Economic fluctuations can influence consumer purchasing power and demand for insurance products, driving insurers to adapt to changing market conditions. Additionally, demographic shifts, such as an aging population and changing workforce dynamics, present both challenges and opportunities for insurers to address evolving customer needs.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on gross written premium, gross written premium per capita, gross claim payments, loss ratio, and distribution channels.

Modeling approach / Market size:

Market sizes are determined by a Bottom-Up approach, based on a specific rationale for each market layer. As a basis for evaluating markets, we use industry associations, national statistic offices, and international organizations, such as OECD. Next we use relevant key market indicators and data from country-specific associations such as insurance consumer spending, gross domestic product, insurance - consumer price index (CPI), population growth. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, exponential trend smoothing and HOLT-linear. The main drivers are insurance consumer spending and insurance - consumer price index (CPI).

Additional Notes:

The market is updated twice per year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level.