Top Trends in UK Distribution: The General Insurance View

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17 October 2008
Catherine Stagg-Macey


London, United Kingdom 17 October 2008

Top Trends in UK Distribution: A General Insurance View

Distribution of insurance products continues to evolve, is diverse, and favors low-cost channels.

The distribution landscape looks very different since the advent of the direct channel. This transition continues to develop, with the UK market experiencing shifts in sales to new channels, such as aggregators and affinity partnerships. In a new report, Top Trends in UK Distribution: A General Insurance View, Celent discusses the changes in this landscape and poses some considerations for IT strategists.

Today, major insurers in the UK use an array of distribution channels. In the personal lines sector, the dominant channels are direct (30%) and the independent intermediary (32%). Independent intermediaries dominate the commercial insurance sector, with 83% of insurance being sold in this channel in 2006. The United Kingdom has the highest usage of direct channels across Europe, which is still largely dominated by face-to-face interactions.

"The UK market is in a mature development stage, with low-cost channels and new channels, such as aggregators and affinity, becoming increasingly active. This is driven from both the sell side...insurers trying to adopt lean business models in order to compete...and the buy-side, with increasing customer demand for flexibility in buying insurance products," says Catherine Stagg-Macey, senior analyst with Celent’s Insurance group and author of the report.

The persistent message from CIOs is that their IT investments in the distribution channel are focused on ease of doing business. This could translate into several very different projects, such as a revised customer portal with improved functionality or navigation, or an online commissions system for agents and brokers.

Changes in distribution have a varied impact on insurers. Each insurer will have its own challenges to address in focusing on its distribution strategy. There is no "one size fits all" approach. The objective of this report is to provide an update on trends in distribution, the general insurance market, and key technologies that can be used to support these trends.

The 36-page report contains eight figures and five tables. A table of contents is available online.

of Celent's Property/Casualty Insurance research service can download the report electronically by clicking on the icon to the left. Non-members should contact for more information.

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