Now this is useful market info. IE gets lots of press releases about growth markets and the next trend etc. but this one gives the broker network some really meaty data. Yes, we love it, because insurance is a business, it’s a contract between two parties based on covering a potential loss, not a template for world peace and social justice. Here’s the word on hot schemes in 2022:
SchemeServe, a leading cloud-based technology solutions provider for the insurance market and a specialist in the creation and online management of delegated authority schemes, has released the latest results of its bi-annual Index, tracking trends and performance of the insurance schemes market. The data, covering the six-month period from the start of October 2021 to April 2022, identifies the most profitable insurance schemes in the period and highlights a number of trends in different schemes since the start of the pandemic.
Cyber: Cyber continues to grow and outpace many other schemes. Overall volumes have risen 32% on the last six months and nearly 500% since the start of the pandemic! Commission earnings are up 82% in six months. This is the scheme with by far the highest commission earnings increase over the period. The second highest was Combined Liability at 37%.
Professional Indemnity: There were massive increases seen in Professional Indemnity in the last Index which recorded a 69% increase in volumes, a 726% increase in first premium and 28% increase in renewal premium, and a 272% increase in commission earnings. Comparatively in this Index over this last six-month period, the figures have flattened out. Commission earnings rose just a modest 13%.
Caravan/Trailer: In the last six months volumes have dropped 44% compared to the previous six months at the height of staycation summer, but this is still 94% higher than at the start of the pandemic. First premium volumes dropped 57% and renewals dropped 28%. Commission earnings in the last 6 months are up 52% on the start of 2020 when the pandemic hit but have dropped 29% compared to the staycation summer of 2021.
Adam Bishop, CEO of SchemeServe, comments: “At SchemeServe we’re a curious bunch – always looking for ways to be better, offer more. We started this Index in 2019 when we realised we had something unique in the robust data we had now, offering insight into the performance of UK schemes business from the 451 schemes that we run on SchemeServe. We want this data to offer valuable insight, for our clients and the wider industry, in tracking trends and identifying the most profitable schemes.
We went public with the data in our first ever Index just months before the pandemic hit the world, so in this latest Index it has been interesting to compare figures for the last six months as we arguably exit the pandemic, to the previous six months periods running right back to the start of the pandemic. It is interesting to see those schemes that have taken off during this period and endured, or not, and those that have perhaps more surprisingly taken more time to bounce back, if at all.”
Combined Liability: Volumes have remained largely static in the last 6 months, but premium income has risen 32% and commission earnings 37% – the second highest increase for commission earnings for any of the schemes in the Index. Overall the figures show a steady improvement on levels during the pandemic; volumes of first premiums and renewals are up 40% on the start of the pandemic and premium income up 119% on that period. The index shows signs this growth has levelled off now, with only a modest increase in volumes and premiums in the last six months.
Contractors All Risks: One of the best performers in 2019/20, the numbers fell dramatically at the end of 2020 and beginning of 2021. Since the start of the pandemic commission earnings have fallen 84%. In the last six months renewals are up 30% and commission income up 27% on the previous six-month period, showing a steady improvement.
EL: No materials changes in this last six-month period compared to falls in premiums and commissions in previous Indices. Volumes too were static.
Pubs & Clubs: There has been a marked drop across the board for these schemes in the last six months. Commission earnings 102% up and premium income up 92% on the period Oct 20 – April 21, has since dropped to 14% and 16% respectively. Volumes are also down 29% in the last six months compared to the previous six months.
Property Owners (Commercial): As predicted in the last SchemeServe Index, the picture has improved in the last six months. Volumes are up 21%, premium income is up 27% and commission earnings up 25%.
SME: Premium income has risen 76% compared to the start of lockdown and volumes are 57% higher, but this growth does appear to have flattened out in the last six months. Renewals increased but total volumes only rose 3% in six months.
Specialist Combined: Figures have been static in the last six months, but compared to the start of lockdown, commission income is up 92% and premium income up 32% despite only a 3% rise in volumes. This would likely be down to an increase in premiums overall. Premiums were reduced in lockdown for a lot of specialist combined insurances, for example where non-essential workers/companies were not trading and cover requirements were striped right back or cancelled. Commission and premiums should now increase as clients get back to trading. Also, the wage roll and turnover have an impact on premiums; post pandemic companies’ wage rolls and turnover forecasts have and will be increasing, thus the increase in premium income and in turn commission income increase. Volumes are likely static as there are fewer new businesses requiring cover.
Pet: Volumes are down 70% on the previous six months and down 97% compared to the same period last year. Is this a sad indication that the boom in pet ownership during lockdowns has abated, or possibly that pet insurance is being sacrificed during the standard of living squeeze?
Event: Premium income has dropped 95% on the last six-month period according to the Index, which is perhaps surprising as many of us would have expected the events industry to have picked back up more recently. This could be a case of needing more time for confidence to grow in this area.
Motor Trade: Volumes increased 32% on the previous 6 months and premium income rose 39%. The figures show a marked improvement and bounce back following the lockdowns, but premium income levels are still nowhere where they were before the pandemic.
The data comes from the SchemeServe Premium Index which is a bi-annual pulse check on the Schemes market. The only insurtech with a 20-year heritage, SchemeServe now works with most of the leading schemes brokers and insurers. It designs and operates schemes for insurers and delegated authority brokers and MGAs via its cloud-based platform. It offers an agile platform allowing them to get schemes up and running in a matter of days and make any updates (rate changes, changes from regulatory demands, or launch new products, for example) quickly and securely.