The Potential for Bundled Insurance Products

Transcription

1 A Datamonitor Brief timely The Potential for Bundled Insurance Products Publication Date: Aug-04 Product Code: Reacting to the latest news breaking in your industry focused Hundreds of hours of analyst time distilled into a few pages primary research Bluesure relaunched its innovative bundled insurance proposition at the end of This strategic, thought provoking piece examines the potential demand for this type of policy in the UK. What consumers' think of bundled insurance and whether they would be willing to pay a slight premium for the convenience it offers is explored using Datamontior s unique consumer data. How best to distribute this type of policy is also considered, resulting in a thorough assessment of the supply and demand forces at work in this new market. Unique survey data and interview results thought-provoking For details of all Datamonitor briefs, go to: services Fresh opinions and out-of-the-box thinking

2 timely Reacting to the latest news breaking in your industry Scope and coverage Unique consumer data examining what consumers think of bundled insurance and whether they would be willing to pay extra for this sort of service In-depth interviews conducted with a wide range of industry executives to gauge industry opinion on the concept of bundled insurance Draws on the results of Datamonitor's unique Broker Survey Utilizes Datamonitor's internal expertise as market experts to assess the potential for bundled insurance in the UK Key findings and highlights Datamonitor's unique consumer research revealed that males showed a higher interest in this type of policy than females. The channel consumers use to buy their general insurance products has no real impact on their interest in the concept of a bundled insurance product. Brokers have mixed attitudes towards this type of product. Some feel that the core service they offer clients is finding the best cover to meet their particular needs by shopping around the market, hence they are reluctant to recommend one provider for all cover. Others feel this product is an attractive proposition for their clients. Use this report to find out... What consumers are views on this type of policy? Are brokers keen to sell personal insurance in a bundled format? Will Bluesure do what Direct Line did for the insurance market in the 80s? Contact us...

3 focused Table of contents Hundreds of hours of analyst time distilled into a few pages CHAPTER 1 INTRODUCTION Catalyst Methodology CHAPTER 2 CONTEXT Introduction - Personal general insurance market estimated to be worth 19.9 billion in Penetration rates vary between core products - Insurance demand is increasing - The number of households is increasing - The number of cars on the road continues to increase - The UK personal general insurance market is competitive - The broker channel is losing ground in terms of distribution CHAPTER 3 THE BUNDLED INSURANCE CONCEPT - What is bundled insurance? - The origins of bundled insurance The case study: Bluesure - Introduction - The proposition - How does the policy work? - Will the pricing be transparent? - Initial target market and distribution strategy - What went wrong? - Withdrawal of capital backing - Unsuitable distribution channel - The relaunch - Finding a capital provider - Reconsidering its distribution strategy - What brokers think - What is Bluesure's goal within the personal insurance market? CHAPTER 4 ASSESSING MARKET DEMAND FOR BUNDLED PRODUCTS - Introduction - Consumers' attitudes to bundled insurance - Approximately one in three open to the idea of bundled insurance - More men are interested than women - A slightly higher proportion of C1s are interested - Those aged between 25 and 34 are particularly open to this type of policy - However after futher consideration this proportion is likely to fall - Will consumers pay a slight premium for the convenience this policy offers? - 20 per cent of consumers would be willing to pay a bit extra for this service - ABs are the least willing to pay a premium for this type of service - Consumers in the younger age groups are more willing to pay a bit extra - Direct consumers unwilling to pay a bit extra - Conclusions CHAPTER 5 ASSESSING POTENTIAL SUPPLY ISSUES FOR BUNDLED PRODUCTS Introduction - Which channel is most suited to selling this type of product? - Interest does not vary based on channel used to arrange insurance products - Brokers' attitudes to bundled insurance - 61 per cent of brokers would be interested in offering bundled insurance - Approximately one in five brokers thought bundled insurance would be very popular with customers - Convenience is the main reason why this type of policy would be popular - Customers' reluctance to have all their insurance products with the one provider could threaten the success of bundled insurance - How will consumers feel about their broker trying to sell them a bundled proposition? - Is this type of product suited to being sold through banks and building societies? - Could an established brand perhaps launch this product with greater success? - Conclusions Contact us...

4 timely Reacting to the latest news breaking in your industry CHAPTER 6 CONCLUSIONS Introduction - Why hasn't a traditional provider launched this type of policy? - Will other providers enter? - Demand appears to be lacking - Good idea in theory but potential seems limited... - Will Bluesure be a success the second time around? APPENDIX Supplementary data - Consumer data Definitions Research Methodology - MORI methodology - Datamonitor's Broker Survey methodology Current readings Future readings Relevant links Do you need more information? - Datamonitor's custom research capabilities SPP writing team LIST OF TABLES Table 1: The size of UK households by number of people, Table 2: Personal GWP split by line of business, e Table 3: Tenure structure in UK households, p Table 4: Number of vehicles licensed in the UK by type of vehicle, Table 5: "I would be interested in using such a service" split by gender Table 6: "I would be interested in using such a service" split by social class Table 7: "I would be interested in using such a service" split by age Table 8: "I would be interested in using such a service" split by distribution channel Table 9: "In theory I would be wiling to pay a bit extra for this servicethan if taking out these types of insurance separately with different providers" split by gender Table 10: "In theory I would be wiling to pay a bit extra for this service than if taking out these types of insurance separately with different providers" split by social class Table 11: "In theory I would be wiling to pay a bit extra for this service than if taking out these types of insurance separately with different providers" split by age Table 12: "In theory I would be wiling to pay a bit extra for this service than if taking out these types of insurance separately with different providers" split by distribution channel LIST OF FIGURES Figure 1: Private motor is the largest line within the UK personal insurance market Figure 2: The total number of UK households increased by 0.3 million in 2003 largely due to growth in two person households Figure 3: On the face of it, one in three consumers seem interested in the bundled insurance concept Figure 4: Males are more open to the bundled insurance concept Figure 5: C1s appear to be most interested Figure 6: year olds are most likely to be interested Figure 7: One in five would be willing to pay a bit extra for this type of policy Figure 8: Interest does not vary based on the channel used to arrange insurance products Figure 9: Almost one in three brokers who provide personal insurance products would be interested in offering bundled insurance Figure 10: 55 per cent of brokers thought that bundled insurance would be popular to some degree Figure 11: Brokers' views on bundled insurance T Figure 12: Opinions of the strategy managers from leading players within the personal insurance market in the UK Figure 13: The number of owner occupied households increased in 2003 Figure 14: Datamonitor's core consulting capabilities Contact us...

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