Latest survey shows volumes improving, but confidence low
The UK general insurance industry saw a decline in confidence over the past three months, according to the latest CBI/PwC financial service survey.
The drop in confidence was surprising given a “solid increase in volumes and a further rise in activity expected across the first three months of this year”, the survey said.
Optimism amongst insurance brokers fell for the first time in five years, with little change in business conditions expected.
Insurers see the need for a broad range of actions to ensure that the UK remains a leading fintech and innovation centre. Among the chiefs concerns are the need to attract talent, accelerate the digitalisation of services and ensure sufficient investment in technology infrastructure.
Firms also see an important role for regulators and government collaboration. Accessing talent was a particular concern amongst general insurers.
Commenting, Jim Bichard, UK insurance leader at PwC, said: “The impact of Brexit has manifested itself as a drop in overseas business for the general insurance community, perhaps unsurprisingly given London’s role as an international speciality hub.
“For insurance brokers, competition is as high as it has been for a while from other financial services businesses, or new entrants. These brokers are increasingly at risk of disintermediation with emerging technologies like blockchain. They are having to evolve their business model to focus on advice rather than transactions.
“Focusing on fintech more generally, the biggest hurdle facing the insurance sector is not the availability of fintech or the infrastructure, it’s having the people who understand it. Our clients believe the best way to be more fintech- enabled is to invest in people.”