United Kingdom (UK) Private Landlord Insurance Market Analysis and Competitive Landscape
Summary
This report estimates the size of the UK’s residential landlord insurance market and explores how it has changed in recent years at a time when the buy-to-let sector has been hit by a swathe of regulatory changes. The report discusses drivers of the buy-to-let and private residential markets, which can directly impact the private landlord insurance market. The report presents market size forecast data to 2028.
We estimate that the gross written premium (GWP) for the residential landlord insurance market in the UK will be GBP911.7 million in 2023. This has mainly been driven by the effects of higher inflation and supply chain disruptions driving up the cost of rebuilding property. The landlord sector has been impacted by changes in regulations and tax laws since 2016, which has led to investing in property being less appealing financially than in the past. There has been a growing trend in the formation of limited companies to hold investment properties in an effort to reduce tax liabilities. In particular, our results show that 65.4% of private landlords keep the right kind of insurance to protect their rental properties, indicating that many may be underinsured.
Scope
- The residential landlord insurance market has reached an expected GBP911.7 million in GWP, a 7% increase in 2023.
- Direct Line dominates the landlord insurance market with a share of 32.5% in 2023.
- Underinsurance is prominent in the residential landlord insurance market. 65.4% of private landlords have the correct cover, while the remainder do not protect their investments adequately.
- 62.8% of private landlord insurance policies were obtained directly via insurers (38%) and through brokers (24.8%) in 2023.
- Understand the current and future size of the UK private landlord insurance market and its drivers.
- Discover the impact of recent legislation on the buy-to-let market and how this has affected the residential landlord insurance market.
- Identify how the profile of landlords is changing in order to better understand their insurance needs.
- Keep up to date with the latest trends and drivers affecting renters, landlords, and the insurance market.
- Executive Summary
- Market overview
- Key findings
- Critical success factors
- Residential Landlord Insurance and Private Residential Market Overview
- The residential landlord insurance market experienced strong growth
- Table Figure 1: The private landlord insurance market's GWP grew by 7.0% to GBP911.7 million in 2023
- Table Figure 2: 34.6% of private landlords do not have adequate cover or have no insurance in place at all
- Multiple private landlords have been switching to limited companies to hold their BTL investments
- Table Figure 3: 19% of households in the UK were private rented in 2021/22
- Table Figure 4: The number of private rented households increased by 6.0% in 2022
- Table Figure 5: The number of buy-to-let companies continued to increase in 2023
- Table Residential landlords can now only deduct finance costs based on a basic rate
- Table Private landlords pay a 3% surcharge on top of the standard SDLT rate
- Table Capital Gains Tax rates split by tax bracket in 2023
- Table Figure 6: Landlords are not very optimistic about the renters bill that will give tenants more power
- Property prices have stagnated in 2023
- Table Figure 7: Average UK house prices have shrunk in 2023
- Table Figure 8: Gross advances and new residential lending commitments have fallen in 2023
- Table Figure 9: The proportion of BTL advances has slowly been falling in 2023, reaching 7% in Q4 2023
- Table Figure 10: Private rental price growth has increased substantially since the start of 2021
- Table Figure 11: Unaffordable house prices alongside saving for a deposit are the main reasons individuals rent
- Table Figure 12: Demand for rental properties grows as available properties become scarce
- The residential landlord insurance market experienced strong growth
- The Profile of Landlords
- The profile of landlords is changing
- Table Figure 13: Three quarters of landlords own either one or two investment properties
- Table Figure 14: The proportion of accidental landlords increased by 5pp in 2023
- Table Figure 15: The largest age group of landlords was 30-34-year-olds
- Table Figure 16: The proportion of landlords aged between 25 and 44 has increased by 21.8pp from 2021 to 2023
- Table Figure 17: More 25-44-year-olds go through the broker and bank channel than those aged 45+
- The profile of landlords is changing
- Competitive Landscape and Product Distribution
- Key players and elements of cover
- Table Figure 18: Direct Line dominates the market with a share of 32.5%, followed by AXA with a share of 18.1%
- Distribution dynamics
- Table Figure 19: 38.0% of policies are sold direct through the insurer
- Table Figure 20: 24.8% of landlords purchased their policy online via a smartphone/tablet in 2023
- Key players and elements of cover
- The Market Going Forward
- The UK private landlord insurance market will record a slowdown in growth
- Table Figure 21: The UK private landlord insurance market is forecasted to grow to GBP946.1 million by 2028
- The UK private landlord insurance market will record a slowdown in growth
- Appendix
- Abbreviations and acronyms
- Methodology
- Table Figure 22: Forecasting methodology
- Secondary sources
- Further reading
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