UK Employers' Liability Insurance 2009

리서치사	Datamonitor
발행일	2009년 10월	상품코드	101281
페이지 정보	62 pages
가격	US $ 2,795 ￦ 3,330,200 PDF by E-mail (Single User License) US $ 6,988 ￦ 8,326,200 PDF by E-mail (Global Site License)

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Abstract

Introduction

The report is an invaluable guide to the UK employers' liability insurance market, providing insight into competitor strategies, profitability and performance as well as overall market growth and trends. It examines trends in distribution and identifies the key drivers behind claims inflation. The report also provides forecasts for the size and profitability of the market up to 2013.

Scope of this research

A discussion of the competitive issues and prevailing trends within the employers' liability market
Analysis of the factors driving the market' s recent performance
Forecasts of GWP growth up to and including 2013, based on Datamonitor' s in-house expertise and interviews with senior industry executives

Research and analysis highlights

Many insurers that Datamonitor contacted noted that the market has become differentiated with certain sectors suffering from competitive pricing more than others. Most insurers reported flat or moderately increasing rates for renewals while new business quotes continued to attract intense competition and lower premium rates

The primary reason for the lack in growth in the claims bill between 2004 and 2008 was the reduction in the number of employers' liability claims. This has been countered however by relatively high claims inflation and the high cost of settling each claim.

A majority of SMEs that would buy online were inclined to purchase products such as public or employers' liability insurance. This reflects not only the widespread and common use of these products by SMEs but also the relatively commoditized nature of these insurance products that often can be included in packages that target smaller SMEs.

Key reasons to purchase this research

Obtain a comprehensive understanding of the key trends in the employers' liability market insurance in the UK.
Benchmark your company against your competitors based on current and past performances in the market.
Develop your future business plans from an informed viewpoint with Datamonitor' s GWP forecast for the employers' liability insurance market.

OVERVIEW

Catalyst
Summary

EXECUTIVE SUMMARY

The EL sector was challenging in 2008
- Lower premium rates due to competition remains the key driver behind the market' s decline
- Despite increases in net written premiums, the market was unprofitable
- Gross claims costs increased in 2008 by 9.6%
Brokers dominate distribution
- Independent insurance intermediaries of all types retained their leading market share in 2008
- Commercial liability insurance is considered to be least at risk from the direct channel
- SMEs are relatively open to internet arrangement of their employers' liability cover
Zurich, Aviva, RSA, AXA and QBE are the top five players
- Zurich remained by far the largest insurer in the market
- Aviva, RSA, AXA and QBE are firmly entrenched in the top five
The EL market is set to harden
- Premium income is forecast to reach a high of £2.4 billion in 2013

MARKET CONTEXT

Introduction
The EL sector was challenging in 2008
- The market shrank in 2008 as rates fell
- The Lloyd' s market has written a declining amount of employers' liability business in recent years
Premiums rates fell
- Lower premium rates due to competition remains the key driver behind the market' s decline
- Policy count was relatively unchanged in 2008 as the recession had not yet affected the market
The market made an underwriting loss
- Despite increases in net written premiums, the market was unprofitable
- Commissions and expenses costs are estimated to have continued their decline in 2008
Employers' liability claims costs increased in 2008
- Gross claims costs increased in 2008 by 9.6%
- Employers' liability claims volumes have declined significantly in recent years
- The British Coal schemes' costs have advanced only slightly
- Workplace injuries and ill health continued to decline in 2007/08
Regulation is having an impact
- A compensation fund along the lines of the Motor Insurance Bureau has been proposed for the market
- Zurich has pursued a court case that benefits insurers still active in the market
- The updated Health and Safety Act coming into effect could mean higher costs for employers' liability insurers
- Employers' liability claims will not be included under the fast track scheme in government reforms
- Proposed pleural plaques legislation can cause uncertainty for the market
Fraud is a serious problem for insurers
- Fraud is a serious issue for the employers' liability market, particularly in light of the recession
- Insurers have invested in anti-fraud programs that also benefit the employers' liability account

CUSTOMER FOCUS

Introduction
Brokers dominate distribution
- Independent insurance intermediaries of all types retained their leading market share in 2008
- Direct players account for a small but important portion of the commercial general insurance market
- Corporate partnerships have maintained only a small presence in the commercial insurance market
- Banks and building societies distribute negligible amounts of commercial general insurance
- Commercial liability insurance is considered to be least at risk from the direct channel
An internet proposition could gain ground with SMEs
- Brokers dominate among all sizes of SMEs, though they have greater market share among larger SMEs
- Face-to-face arrangement is popular in the market but is more prevalent among larger SMEs
- SMEs are relatively open to internet arrangement of their employers' liability cover
High levels of retention go along with high levels of satisfaction
- SMEs are generally happy with their insurance provider
- SMEs tend to prefer longstanding relationships with their providers, making an initial pitch critical
A large proportion of SMEs are unlikely to switch to a new provider
- More SMEs considered a change of provider in 2009 than in 2008
- A variety of companies, from different industries, believe they will change their provider over the next year
- SMEs that use the internet to arrange their insurance are the most likely to search out a new provider

COMPETITIVE DYNAMICS

Introduction
Zurich, Aviva, RSA, AXA and QBE are the top five players
- Zurich remained by far the largest insurer in the market
- Aviva, RSA, AXA and QBE are firmly entrenched in the top five
Travelers bucked the trend
- Allianz was the 6th largest EL insurer in 2008
- Travelers increased its GWP
- Allchurches is the 10th largest player
- Lloyd' s syndicates underwrote around £100m of EL business
The average gross loss ratio was 73%
- Gross loss ratios for AIG and Allianz improved substantially in 2008
- AXA and ACE experienced only marginal change in their gross claims ratios, which still beat the market average
- Gross loss ratios increased for most of the top 10

FUTURE DECODED

Introduction
The EL market is set to harden
- The recession will weigh heavily on GWP growth, though it is generally accepted that rates must rise
- Premium income is forecast to reach a high of £2.4 billion in 2013
- The combined ratio is expected to remain well above 100%

APPENDIX

Definitions
- Premium income measures
- Distribution
- Definitions of general terms
Methodology
- Commercial Insurance Broker Survey - March 2009
- Datamonitor' s SME Insurance Survey Q2 2009
Further reading
Ask the analyst
Datamonitor consulting
Disclaimer

TABLES

Table: UK employers' liability insurance GWP (ABI members), 2000 - 08 (£m)
Table: Lloyd' s market UK employers' liability insurance GWP, 2005 - 08p
Table: UK company insolvencies, 2004 - 2009 Q1p
Table: UK employers' liability underwriting result, 2004 - 08 (£m)
Table: Employers' liability gross claims costs, 2004 - 08 (£m)
Table: Number of employers' liability personal injury claims split by accident and disease, 2003/04 - 2008/09
Table: Number of claims made to the DTI and total compensation paid for respiratory disease and VWF under the British Coal scheme as of April 5, 2009
Table: Workplace injuries reportable under RIDDOR, 2003/4 - 2007/8p
Table: Workplace injuries reportable under RIDDOR, excluding acts of violence, 2003/04 - 2007/08p
Table: Workplace fatalities reported under RIDDOR, 2003/04 - 2007/08p
Table: Total estimated workplace injuries reportable to the HSE, 2003/04 - 2007/08p
Table: Number of cases of occupational disease and work related mental ill-health, 2003 - 07p
Table: Estimated number of work-related and occupational respiratory disease, 2003 - 07p
Table: Market share of the distribution channels in the commercial general market, 1999 - 2008 (%)
Table: Q: "How long have you been with your current insurance provider?"
Table: Q: "Do you think you will change your commercial insurance provider in the next 12 months?"
Table: Top 10 UK employers' liability insurers by market share and GWP, 2007 - 08
Table: Gross claims ratio of the top 10 employers' liability insurers, 2004 - 08 (%)
Table: Key variables affecting employers' liability insurance GWP, 2008e - 13f
Table: Employers' liability premium income forecast (ABI members), 2003 - 13f (£m)
Table: Forecast of EL combined ratio, 2009-13 (%)
Table: What banding does your company fall into in terms of general insurance premium income turnover?
Table: Q: "What business sector are you involved in?"
Table: Q: "How large is your company in terms of number of employees?"
Table: Q: "How large is your company in terms of turnover?"

FIGURES

Figure: SMEs show the greatest willingness to purchase public and employers' liability insurance online
Figure: Lloyd' s market players have continued to write a declining amount of UK employers' liability business
Figure: UK company liquidations increased sharply in 2008 due to the recession
Figure: The employers' liability market made another underwriting loss in 2008
Figure: Gross claims costs resumed their growth in 2008, after a sharp decline in 2007
Figure: The number of employers' liability claims relating to disease has fallen significantly in recent years
Figure: Workplace deaths have declined from their most recent peak in 2006/07
Figure: Cases of lung-related occupational disease increased in 2007
Figure: National brokers witnessed a significant increase in their share of the UK commercial insurance market in 2008
Figure: Commercial motor is considered to be at most risk from the direct channel
Figure: Brokers have the highest penetration among medium-sized firms
Figure: Micro SMEs are most comfortable with arranging their cover over the telephone
Figure: SMEs show the greatest willingness to purchase public and employers' liability insurance online
Figure: Satisfaction levels in the market remain high
Figure: Very few SMEs have changed their provider in the last two years
Figure: Companies in the education sector are the most likely to seek out a new quote in the next 12 months
Figure: Clients which arrange their insurance through the internet are the most likely to search for another provider
Figure: Zurich remains the clear market leader
Figure: Loss ratios for the top 10 insurers generally deteriorated
Figure: The market is predicted to grow between 2009 and 2013
Figure: The combined ratio is expected to remain at well over 100% across the forecast period