Research and Markets: This Essential Report Provides a Detailed Analysis of the UK Commercial Property Insurance Market

November 11, 2009 7:57 AM EST

DUBLIN--(BUSINESS WIRE)-- Research and Markets (http://www.researchandmarkets.com/research/cc645c/uk_commercial_prop) has announced the addition of the "UK Commercial Property Insurance 2009" report to their offering.

This report provides a detailed analysis of the UK commercial property insurance market. It looks at the size of the market, performance ratios, claims costs, key issues and distribution trends. It also assesses the competitive landscape providing market share information and forecasts the total market GWP up to and including 2013.

Scope

    --  An examination of market size, growth and profitability.
    --  Analysis of the key drivers of claims inflation.
    --  Market share and combined ratio data for the largest commercial property
        insurers.
    --  Forecasts of market size and profitability to 2013.

Highlights of this title

    --  The market peaked in terms of premium growth rates in 2002 and
        thereafter growth rates declined moving into negative territory in 2005.
        Between 2005 and 2007 the market contracted before seeing growth for the
        first time in several years in 2008, as insurers put through small rate
        increases. In 2008 the market was worth 4.3 billion.
    --  Analysis of gross incurred claims for the period to H1 2009 indicates
        that claims costs have been fairly benign for the first half of 2009
        which bodes well for the sector. Gross incurred claims totaled 737m for
        H1 2009 which compares to 757m for H1 2008 and represents a fall of
        2.6%.
    --  Industry executives believe that the issue of players seeking market
        share for new business will hamper any renewal rate increase in the
        immediate future.

Key reasons to purchase this title

    --  Understand the direction in which the commercial property insurance
        market is moving in terms of premium rates, profitability and future
        claims.
    --  Assess the market share of the major distribution channels, the key
        players and the latest competitor developments.
    --  Gain insight into the views and opinions of some of the leading industry
        executives.

Key Topics Covered:

Executive Summary

    --  The market grew slightly as insurers put through small rate increases
    --  The market was worth 4.3 billion 2008
    --  Commercial property insurers suffered from a high COR in 2008, net of
        reserve releases
    --  The sector made a profit after the effects of reserve releases
    --  2009 has been a benign year for claims costs so far
    --  2009 is shaping up to be another benign year for claims costs
    --  Large national brokers continue to dominate commercial insurance
        distribution
    --  Independent insurance intermediaries of all types retained their
        majority market share in 2008
    --  Allchurches and Travelers both gained market share
    --  Allchurches experienced a 0.5 percentage points growth in its market
        share to 4.4% of the commercial property market
    --  Travelers witnessed a significant 14% growth in GWP
    --  Aviva, RSA, Zurich, AXA and Allianz continue to hold the top 5 market
        positions
    --  Aviva was the market leader in 2008
    --  Zurich retained its third place ranking
    --  AXA experienced a 4.1% decline in GWP, taking its market share to 11.1%
        in 2008
    --  Allianz's market share for 2008 was 7.2%, making it the fifth largest
        player
    --  ACE was the ninth largest commercial property insurer in 2008
    --  Underwriting losses will decrease as the market hardens
    --  The commercial property market is predicted to be worth 5.9 billion by
        2013

Market Context

    --  Introduction
    --  The market grew slightly as insurers put through small rate increases
    --  The market was worth 4.3 billion 2008
    --  In terms of real growth, the market contracted by 2.1% in 2008
    --  Commercial property insurers suffered from a high COR in 2008, net of
        reserve releases
    --  The sector made a profit after the effects of reserve releases
    --  The COR, excluding reserve releases, reached 115% in 2008
    --  Reserve releases expanded significantly throughout 2008
    --  Commercial property insurers made sizeable reserve releases in 2008,
        higher than 2007 levels
    --  2009 has been a benign year for claims costs so far
    --  2009 is shaping up to be another benign year for claims costs
    --  Commercial property claims costs resulting from fire and theft increased
        in 2008
    --  The AXA Business Crime Index has shown a marked increase of recessionary
        crime
    --  More than half of total claims costs in commercial property arose from
        fires in 2008
    --  Modern methods of construction, amongst other things, have lead to the
        increase in fire losses
    --  The 'Approved Document B (Fire safety)' has been one of few steps in
        recent years to mitigate fire risks
    --  Automatic fire protection systems that generate false alarms may prompt
        higher premiums
    --  Weather related commercial property claims decreased significantly in
        2008
    --  Business interruption claims costs following fire grew by 21.7% in 2008
    --  The cost of commercial property insurance theft claims increased
        marginally in 2008
    --  The average value of a theft claim increased to 4,515 in 2008 from
        GBP4,223
    --  Insurers are pressuring the government for improvements in flood
        defenses
    --  The 2007 floods were a catalyst for insurers seeking government
        assistance to limit flood risk exposure
    --  The Draft Floods and Water Management Bill has been warmly welcomed by
        the industry
    --  The 2009 Budget commitments showed some signs of the government
        listening to the insurance industry
    --  The UK Climate Projections provides valuable information and data about
        climate change
    --  The Ordinance Survey's data-rich resources are also of much use to the
        insurance industry
    --  However, insurers still feel that the government should spend more on
        flood defenses
    --  There is a risk that the Statement of Principles will not be renewed
        unless more government action is taken

Distribution

    --  Introduction
    --  Large national brokers continue to dominate commercial insurance
        distribution
    --  Independent insurance intermediaries of all types retained their
        majority market share in 2008
    --  Electronic distribution is gathering pace and insurers believe that it
        will become more prevalent
    --  Direct players account for a small but growing portion of the commercial
        general insurance market
    --  Corporate partnerships have maintained only a small presence in the
        commercial insurance market
    --  Banks and building societies distribute negligible amounts of commercial
        general insurance
    --  30% of SMEs would consider purchasing their insurance policy from a bank
        or building society
    --  Brokers remained the dominant distribution channel to target SMEs in H1
        2008

Competitive Dynamics

    --  Introduction
    --  Allchurches and Travelers both gained market share
    --  Allchurches experienced a 0.5 percentage points growth in its market
        share to 4.4% of the commercial property market
    --  Travelers witnessed a significant 14% growth in GWP
    --  Aviva, RSA, Zurich, AXA and Allianz continue to hold the top 5 market
        positions
    --  Aviva was the market leader in 2008
    --  Zurich retained its third place ranking
    --  AXA experienced a 4.1% decline in GWP, taking its market share to 11.1%
        in 2008
    --  Allianz's market share for 2008 was 7.2%, making it the fifth largest
        player
    --  ACE was the ninth largest commercial property insurer in 2008
    --  Travelers, Zurich, RBS, Allianz and Aviva beat the market average COR,
        after allowing for reserve releases
    --  Acquisitions by brokers continued, albeit at a slower pace than previous
        years
    --  AXA has continued to increase its presence in the UK commercial
        insurance market through its broking arm Bluefin
    --  Giles acquired numerous commercial brokers in 2008
    --  Oval completed 12 acquisitions in the 12 months to June 2008
    --  Cullum Capital Ventures continued with its acquisition strategy in 2008
        and 2009
    --  JLT acquired Ingham Underwriting

Future Decoded

    --  Introduction
    --  Underwriting losses will decrease as the market hardens
    --  The market will grow slowly in 2009 and harden significantly thereafter
    --  The commercial property market is predicted to be worth 5.9 billion by
        2013
    --  Losses, net of reserve releases, will fall as the market hardens

APPENDIX

Companies Mentioned:

    --  AXA
    --  Health Protection Agency

For more information visit http://www.researchandmarkets.com/research/cc645c/uk_commercial_prop

Source: Datamonitor

    Source: Research and Markets

Stocks Mentioned

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