The BriefYourMarket.com blog

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The affordability crisis in insurance: what’s your response going to be?

insurance-affordability-crisis

A new survey conducted by Premium Credit has shed some light on the affordability crisis in the insurance sector, with more than two million policyholders in the UK reportedly borrowing money from their loved ones, just to afford cover.

Your brokerage already has to contend with online aggregators and direct insurers, so what’s your strategy to win over – and offer support to – your price-wary customers in 2019?

There’s a very dangerous perception amongst today’s consumers that policies are a luxury rather than a necessity, shown by the fact that so many are willing to go without or opt for the bare minimum, leaving themselves exposed and underinsured.

Premium Credit found that over the last twelve months, 24% have cut back on the “quality” of their insurance cover, which is a trend they’ve predicted will continue into next year, with a further 18% expected to follow suit.

These cut backs were seen across an array of policy types, including:

Strategy and Marketing Director at Premium Credit, Adam Morghem, credits this development to the fact that “many types of insurance premium have been increasing” over the years, pointing out that consumers are putting themselves at risk because they can’t afford the alternative.

Of those with policies in place, 66% claim they’ve seen a considerable price increase in the last two years, whilst 14% are only able to manage their payments by relying on loans or credit cards.

 

Who is most affected by this?

Millennials are amongst those most affected, given that one in three may never own a home, spending £53,000 on rentals by the time they reach their 30s.

As the next generation of consumers, it’s crucial that your business – and even your industry – build traction and trust with this group in order to secure longevity, and the way to do this is through demonstrating your brokerage’s value.

The average annual cost of owning and running a car falls at £2,400, most of which is taken up by insurance at a price that’s steadily increasing.

Unfortunately, this disproportionately impacts young motorists, with a small minority resorting to great lengths to avoid hefty policy fees – either by claiming that they’re not the primary driver or by going on the road without cover, putting themselves and others at risk.

There are one million uninsured drivers in the UK, which works out to be around one in every 38 cars on the road at any given time, so it’s apparent how extensive the affordability problem really is.

Another consumer generation that’s struggling to afford insurance is the over 65s. Seen as being “too high risk” by some insurers, experts are concerned at the number of retirees travelling uninsured because they “can’t afford – or object to – the premiums”.

Businesses within the finance sector – such as insurance and banking – see an abandonment rate of 83.7%, which is expected to be a result of the time and complexity involved in filling out online forms, compared to retail (77.3%) and fashion (67.6%).

So, how are you generating new leads and increasing your conversion rates, even with your most difficult-to-convert customers?

 

What your response needs to be…

Senior Researcher at Fuel Cycle – Nick Chadwick – suggests that “the engagement of millennials is more multi-faceted than what was seen with previous generations”, as they want to connect with brands via multiple online mediums.

In fact, he goes on to state that as it currently stands, those aged under 35 are more than twice as likely to buy insurance online, with over half preferring to work directly with providers as opposed to through intermediaries.

Yet, Baby Boomers are also adopting digital channels at a rapid pace to enhance their brand experience, with smartphone penetration in the 55-75 age range increasing from 40% in 2013 to 77% in 2018.

Today’s consumers are unable to navigate the insurance market, lacking the knowledge to make the right choice using self-service aggregators, and losing value and money by going direct to providers.

Your brokerage offers real market insight, value and savings, but unless you’re demonstrating that to your customers on a regular basis, you’ll be cut out of the process.

By all means, offer price reductions to your budget-conscious prospects, but don’t depend solely on this strategy as there will always be another business willing to go cheaper, and you could ultimately undervalue your expertise.

 

What’s next for your business?

At BriefYourMarket.com, we work with insurance professionals across the UK, helping them to deliver strong marketing messages to their customers with campaign guidance and high-quality content.

To find out how our multi-channel marketing platform can revolutionise your business’ approach to prospecting in 2019, contact our team on 0344 800 84 24.

 

 

A snapshot of 2019 for hospitality professionals
What will you do to compete with Foxtons in 2019?
 

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Saturday, 19 January 2019

The BriefYourMarket.com blog

This is some blog description about this site

The affordability crisis in insurance: what’s your response going to be?

insurance-affordability-crisis

A new survey conducted by Premium Credit has shed some light on the affordability crisis in the insurance sector, with more than two million policyholders in the UK reportedly borrowing money from their loved ones, just to afford cover.

Your brokerage already has to contend with online aggregators and direct insurers, so what’s your strategy to win over – and offer support to – your price-wary customers in 2019?

There’s a very dangerous perception amongst today’s consumers that policies are a luxury rather than a necessity, shown by the fact that so many are willing to go without or opt for the bare minimum, leaving themselves exposed and underinsured.

Premium Credit found that over the last twelve months, 24% have cut back on the “quality” of their insurance cover, which is a trend they’ve predicted will continue into next year, with a further 18% expected to follow suit.

These cut backs were seen across an array of policy types, including:

Strategy and Marketing Director at Premium Credit, Adam Morghem, credits this development to the fact that “many types of insurance premium have been increasing” over the years, pointing out that consumers are putting themselves at risk because they can’t afford the alternative.

Of those with policies in place, 66% claim they’ve seen a considerable price increase in the last two years, whilst 14% are only able to manage their payments by relying on loans or credit cards.

 

Who is most affected by this?

Millennials are amongst those most affected, given that one in three may never own a home, spending £53,000 on rentals by the time they reach their 30s.

As the next generation of consumers, it’s crucial that your business – and even your industry – build traction and trust with this group in order to secure longevity, and the way to do this is through demonstrating your brokerage’s value.

The average annual cost of owning and running a car falls at £2,400, most of which is taken up by insurance at a price that’s steadily increasing.

Unfortunately, this disproportionately impacts young motorists, with a small minority resorting to great lengths to avoid hefty policy fees – either by claiming that they’re not the primary driver or by going on the road without cover, putting themselves and others at risk.

There are one million uninsured drivers in the UK, which works out to be around one in every 38 cars on the road at any given time, so it’s apparent how extensive the affordability problem really is.

Another consumer generation that’s struggling to afford insurance is the over 65s. Seen as being “too high risk” by some insurers, experts are concerned at the number of retirees travelling uninsured because they “can’t afford – or object to – the premiums”.

Businesses within the finance sector – such as insurance and banking – see an abandonment rate of 83.7%, which is expected to be a result of the time and complexity involved in filling out online forms, compared to retail (77.3%) and fashion (67.6%).

So, how are you generating new leads and increasing your conversion rates, even with your most difficult-to-convert customers?

 

What your response needs to be…

Senior Researcher at Fuel Cycle – Nick Chadwick – suggests that “the engagement of millennials is more multi-faceted than what was seen with previous generations”, as they want to connect with brands via multiple online mediums.

In fact, he goes on to state that as it currently stands, those aged under 35 are more than twice as likely to buy insurance online, with over half preferring to work directly with providers as opposed to through intermediaries.

Yet, Baby Boomers are also adopting digital channels at a rapid pace to enhance their brand experience, with smartphone penetration in the 55-75 age range increasing from 40% in 2013 to 77% in 2018.

Today’s consumers are unable to navigate the insurance market, lacking the knowledge to make the right choice using self-service aggregators, and losing value and money by going direct to providers.

Your brokerage offers real market insight, value and savings, but unless you’re demonstrating that to your customers on a regular basis, you’ll be cut out of the process.

By all means, offer price reductions to your budget-conscious prospects, but don’t depend solely on this strategy as there will always be another business willing to go cheaper, and you could ultimately undervalue your expertise.

 

What’s next for your business?

At BriefYourMarket.com, we work with insurance professionals across the UK, helping them to deliver strong marketing messages to their customers with campaign guidance and high-quality content.

To find out how our multi-channel marketing platform can revolutionise your business’ approach to prospecting in 2019, contact our team on 0344 800 84 24.

 

 

A snapshot of 2019 for hospitality professionals
What will you do to compete with Foxtons in 2019?
 

Comments

No comments made yet. Be the first to submit a comment
Already Registered? Login Here
Guest
Saturday, 19 January 2019
 
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