United Kingdom (UK) SME Insurance – Competitor Dynamics 2020

AXA and Aviva remain the market leaders for UK SME insurance, but the fall in the latter’s percent of respondents has widened AXA’s advantage. However, Aviva differentiates itself by selling a greater number of contracts through brokers. This division is significant, as brokers accounted for almost half of the purchasing channel for SME insurance in 2020. In third place, Zurich stands out by having higher net promoter scores than those of the largest two providers, demonstrating an ability to deliver high customer satisfaction levels. In fourth place, Barclays continues to have a strong market presence for SME insurance, capitalizing on its customer relations for business banking. While the UK SME insurance market is dominated by AXA and Aviva, outlier insurers such as Allianz, Hiscox, AA, and Admiral continue to strengthen their market presence through product specialization.

This report identifies which insurers lead the way in the SME segment and examines how they are developing their propositions, while also highlighting how competitor positions vary between micro, small, and medium enterprises. It reveals which insurers are winning over brokers and with which companies SMEs are placing their business.

Scope

– At 7.8% share, AXA’s market position remains unchanged from 2019.

– Aviva’s share fell from 7.6% in 2019 to 6.9% in 2020, yet brokers are more likely to sell both packaged and non-packaged SME insurance from this provider.

– Barclays sells the most insurance contracts to SMEs with a 20.0% market share of the banking channel.

Reasons to buy

– Identify trends that are driving changes in the SME insurance market.

– Assess the financial performance of competitors.

– Identify efficient distribution strategies that complement and support customer purchasing behavior.

Companies mentioned

AXA

Aviva

Zurich

Bupa

AA

NFU Mutual

Barclays

Lloyds Bank

Hiscox

Simply Business

Admiral

Direct Line

RSA Insurance

Swinton

LV=

Table of Contents

Table of Contents

1. Executive Summary

1.1 AXA leads the market for SME insurance

1.2 Key findings

1.3 Critical success factors

2. UK SME landscape

2.1 AXA and Aviva remain the market leaders for UK SME insurance in 2020

2.2 Brokers are integral to the distribution of commercial insurance

2.3 Barclays leads bancassurance

2.4 Influence of PCWs in the UK SME insurance market

2.5 The strengths of the three leading providers

2.6 Insurers can challenge the SME competitive landscape through product specialization

3. SMEs are keen on receiving business strategy advice from an insurer

3.1 Medium-size businesses have the highest uptake of value-added services

4. Top insurers by net promoter score

4.1 Aviva’s NPS lags behind in two of the four main commercial products

5. Supplemental data: Top five insurers by product lines

6. Appendix

6.1 Abbreviations and acronyms

6.2 Definitions

6.3 Methodology

6.4 Secondary sources

6.5 Further reading

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List of Tables

List of Tables

Table 1: The number of SMEs in the UK private sector by business size, 2011–20

Table 2: Top three players’ market shares across each product line, 2020

Table 3: SMEs’ 2020 outlook on value-added services by business size

Table 4: The proportion of SMEs’ NPSs for 2020

List of Figures

List of Figures

Figure 1: Market shares among the top five tighten

Figure 2: Brokers play a key role in the SME purchasing journey

Figure 3: Brokers place the most business for packaged SME insurance with Aviva

Figure 4: Brokers place the most business for non-packaged SME insurance with Aviva

Figure 5: SMEs continue to choose Barclays for SME insurance products over other banks in the market segment

Figure 6: Visually understanding the top five players’ share of respondents in the highly competitive SME insurance market

Figure 7: Business strategy advice is the most sought after value-added service

Figure 8: Aviva’s NPS has a higher level of fluctuation than other top players

Figure 9: Top five players’ shares of respondents for 16 different commercial products (sole traders)

Figure 10: Top five players’ shares of respondents for 16 different commercial products (micro-size businesses)

Figure 11: Top five players’ shares of respondents for 16 different commercial products (small-size businesses)

Figure 12: Top five players’ shares of respondents for 16 different commercial products (medium-size businesses)

Figure 13: Forecasting methodology

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