Some 66% of UK insurance professionals believe a bad Brexit will lead to rising commercial insurance premiums as a result of more claims being made.
The research, conducted by Premium Credit, the UK’s leading premium finance company, reveals that nearly one in five insurance professionals have already seen an increase from commercial clients asking for advice on potential claims relating to Brexit.
A bad Brexit could potentially negatively impact Sterling, which would make overseas claims for UK insurers in relation to travel insurance for example, more expensive. It could also have a negative impact on the UK stock market which could affect insurers’ investment returns.
Some 35% of insurance professionals say that if both the value of Sterling and the investments of insurers fall, it’s ‘very likely’ that they would lead to UK insurance premiums rising, and a further 39% think it’s ‘quite likely’ this would happen.
A bad Brexit could also lead to more UK companies going bust, and Premium Credit’s research found that 23% of insurance professionals believe strongly that this would lead to an increase in the cost of trade credit insurance, which protects organisations against their risk of their clients going bust. More than two fifths (45%) believe this would ‘probably’ happen.
Adam Morghem, Strategy and Marketing Director at Premium Credit said:
“Everyone is hoping against a bad Brexit as the implications of this could be far and wide. Our findings reveal that insurance professionals feel that it could have a very negative impact on claims and see premiums rise, putting even more pressure on many companies, already strained by the potential loss of European suppliers and markets.”