United Kingdom (UK) Commercial Property Insurance Market Size, Trends, Competitor Dynamics and Opportunities
Summary
This report analyzes the UK commercial property insurance market, looking at drivers of uptake across different demographics and dwelling types. It discusses the claims landscape in 2021, as well as the commercial property market across London and upcoming regulatory changes within insurance. Incumbent competitors are analyzed and compared, along with newcomers and insurtechs within the space. Future impactors in the market are also examined, including climate change, underinsurance, and the changing office environment.
Gross written premiums (GWP) in the UK commercial property insurance market grew by 20.2% to reach GBP9 billion in 2021. The market’s major hardening of rates is responsible for this growth, while the demand for policies only slightly increased. Commercial property insurers paid a high price in 2021. Gross claims rose by 4.4% in 2021, above their average level over the previous 10 years. In 2021, the claims landscape was dominated by a 31.0% increase in weather-related claims and a 22.5% increase in fire and explosion claims. As restrictions related to the pandemic began to loosen and enterprises resumed operations, there were 24.9% fewer claims for business interruptions. As building prices continue to rise and the economy struggles to recover from both the epidemic and Brexit, claims inflation—which is mostly driven by global supply-side constraints—will maintain the hardening market.
Scope
- GWP in the UK commercial property market grew to approximately GBP9 billion in 2021, a growth rate of 20.2%.
- Gross claims rose by 4.4% in 2021, above their average level over the previous 10 years, reaching GBP2.4 billion.
- A 31.0% rise in weather-related claims and a 22.5% rise in fire and explosion claims dominated the claims landscape in 2021. There were 24.9% fewer claims for business interruptions when the pandemic-related limitations started to ease and businesses resumed operations.
- Aviva remains the market leader with a market share of 15.2%, growing its GWP to GBP1.37 billion in 2021.
- Analyze the drivers of growth within the UK commercial property market.
- Determine areas of concern for insurers and the wider market, including in the claims landscape.
- Recognize the impact of Brexit and inflation on the market.
- Ascertain the market shares of the leading players.
- Examine future opportunities and challenges within the market.
- Executive Summary
- Market overview
- Key findings
- Critical success factors
- Market Dynamics
- The UK commercial property market grew significantly in 2021
- Table Figure 1: The UK commercial property insurance market grew considerably in 2021
- Table UK commercial property insurance market GWP and growth rate, 2017–21
- The year 2021 was expensive for commercial property claims
- Table Figure 2: Weather-related gross claims paid grew by the fastest rate in 2021
- Table Figure 3: Weather and Fire & Explosion claims both spiked in 2021
- Table Gross claims paid (GBP million), by type, 2017–21
- Table Figure 4: Fire & Explosion was the only claim category to increase in 2021
- Table Number of claims notified (000s), by type, 2017–21
- The construction sector resumes in 2021, recovering from 2020
- Table Figure 5: Construction is expected to bounce back after 2020 and continue to grow
- Table UK commercial construction output, 2021–26f
- Table Construction output, non-seasonally adjusted, current prices by sector (GBP billion), 2017–21
- Investment in London experienced the largest increase since 2017
- Tax incentives and regulations have an impact on people’s investment in commercial property
- Table Figure 6: The rate for buy-to-let mortgages remained low, but only because there were more mortgages overall in 2021
- More commercial-to-residential conversions will occur as housing demand rises and towns level up
- Table Figure 7: The population of the UK is still steadily increasing
- The UK commercial property market grew significantly in 2021
- Competitor Dynamics
- Aviva is still the market leader by some distance
- Table Figure 8: Aviva continues to lead the commercial property market
- Table Competitor market shares and GWP, 2019–21
- Aviva is still the market leader by some distance
- The Market Going Forward
- Commercial property insurance will grow to GBP10.8 billion in 2026
- Table Figure 9: Until 2026, the UK market for commercial property insurance is anticipated to grow annually
- Brexit and COVID-19 will make for a harder recovery for the construction industry than first thought
- Underinsurance problems are exacerbated by global supplyside issues
- Table Figure 10: Concerns about underinsurance plague more than a third of SMEs with commercial property insurance
- ESG initiatives will present opportunities and difficulties for insurers
- Technology is becoming more valuable to commercial property insurers
- The changing landscape of office working represents an opportunity for insurers
- Table Figure 11: After the pandemic, more than half of employees do not anticipate returning to work full-time
- Table Figure 12: Only 20.3% of individuals expect to work full-time at the office post-pandemic, with the majority taking a hybrid approach
- Commercial property insurance will grow to GBP10.8 billion in 2026
- Appendix
- Abbreviations and acronyms
- Methodology
- Table Figure 13: Forecasting methodology
- Secondary sources
- Further reading
- About GlobalData
- Contact Us
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