​UK insurance sector bleeds more than £200bn yearly due to lost billable hours

The UK insurance industry is losing more than £200bn a year due to poor time keeping and lost billable hours, according to a new analysis published today (11 August 2023).

The study, which was conducted by telecommunications company Movius.ai, revealed that 21.6% of billable hours worked by staff in the professional services sector were not accounted or charged for.

This results in approximately £222.1bn in yearly lost turnover for the insurance sector and £437bn worth of lost billable hours for the entrie professional services industry, the research suggested.

It also highlighted that for the average insurance firm, potential yearly lost income was around £30.1m a year.

This was signficantly higher than the benchmark loss of £617,075 for a typical professional services firm.

Mental health

Movius.ai obtained the figures after analysing a survey of over 1,000 senior managers in different professional services sectors as well as business activity data from the Office of National Statistics.

The research also found that 15.7% of full-time workers in England and Wales work more than the 48 hours a week maximum set under the Working Time Directive.

”This suggests that frequent unrecorded overtime resulting from unrecorded billable time may also be a factor that incentivises some staff to work later into the day, which can adversely affect their mental health and productivity at work over time,” Movius.ai said.

In March, employee recognition software company OC Tanner found more than 23% of insurance managers were finding it difficult to stay positive at work.

The firm analysed the perspectives of over 36,000 employees, leaders, HR practitioners and business executives from 20 countries around the world, including 606 from the insurance sector.

Robert Ordever, European managing director of OC Tanner, told Insurance Times that a rise in work could impact mental health and peoples’ ability “to be happy in other areas of their lives”.

John Clear, vice president of sales at Movius.ai, said that the ”lack of sufficient time recording, management and billing of hours worked by staff in insurance firms is having a large impact on the profitability of companies and the mental wellbeing of their staff”.

”A big part of the problem is that time sheets make it difficult to record time, as they rely on employees remembering everything they have done and effectively guessing the length of tasks, such as voice calls,” he added.