Alternative home insurer interest declines in the U.K.
While U.K. consumers are less interested in alternate home insurers than in the past, that doesn't mean traditional insurers should write them off as competition.
U.K. insurance customers showed declining interest in alternative home insurance options in 2022 compared to the previous year, according to GlobalData’s 2022 U.K. Insurance Consumer Survey. Big tech, energy and communications players have long posed a threat to traditional insurance carriers should they chose to enter the space, but a drop in interest in purchasing insurance from these companies may signal declining trust from consumers.
“Although reduced consumer interest in these alternative providers is clear, it still remains a significant threat to the home insurance industry,” Ben Carey-Evans, senior insurance analyst at GlobalData, said in a release. “The greatest threat across the industry as a whole may be embedded insurance. While it is less of a threat within home insurance specifically, product manufacturers (such as mobile providers or car manufacturers) offering insurance at the point of sale offers convenience to customers, so it is a growing trend to watch.”
In 2021, GlobalData’s survey, “any energy provider” topped the list of alternative providers from which customers had purchased, or would purchase, home insurance. In 2022, however, energy providers saw the largest drop in interest among all alternative insurers, falling from 22.5% to 17.3%. Google – while also seeing a drop in interest in 2022 – came in at the top of GlobalData’s latest consumer interest survey with 22.2%, followed by any energy provider (17.3%), Amazon (16.7%), Ikea (15.3%), Sky (13.2%), Samsung (11.6%), Apple (11.5%), any mobile operator (10.7%), any car leasing company (8.7%), Facebook (8.2%) and WhatsApp (8.2%).
Carey-Evans reiterated in the release about the survey that insurers should not shrug off the impact alternative providers could make as they enter the insurance market.
“Therefore, a slight reduction in consumer interest does not mean the threat from big technology providers is waning, as recent developments suggest the opposite is happening. Insurers will be buoyed by what appears to be reduced consumer trust for these potential rivals,” he continued. “However, they will need to ensure they can provide a strong digital offering, as that will be guaranteed from any of these potential threats.”