CBI/PwC survey also found that general insurers’ business volumes grew for first time in two quarters
General insurance brokers’ optimism fell in the fourth quarter of 2014 despite rising business volumes and profitability, the latest CBI/PwC financial services survey found.
The survey, conducted quarterly, also recorded a drop in general insurers’ optimism despite being more profitable in the fourth quarter than they initially thought.
Brokers boost volumes
The CBI/PwC survey found that insurance brokers’ business volumes continued to pick up in the fourth quarter of 2014 at a broadly similar pace to that expected.
But brokers expect growth to slow slightly in the first quarter of 2015.
Brokers’ profitability rose moderately during the quarter and is expected to grow at a stronger pace in the first quarter of 2015.
Insurers escape profit drop
The survey found that general insurers’ business volumes grew for the first time in two quarters in the fourth quarter of 2014.
Insurers also expect business volumes to grow “solidly” in the first quarter of 2015.
It also found that insurers’ profitability rose in the fourth quarter despite expectations of a fall.
But insurers expect profitability to be flat in the first quarter of this year.
PwC UK insurance leader Jonathan Howe said: “There is further pressure on general insurance profits.
“These are not expected to grow despite business volumes increasing as total costs are still rising, which coincides with the overall decline in optimism at the end of 2014.”