DWF survey finds UK firms satisfied with insurers but buying process a concern

The vast majority (94%) of UK businesses are satisfied with the service of their current insurers, according to a report from law firm DWF. However, The future of insurance: consumer expectations report also reveals that 70% of businesses believe the insurance-buying process could be improved, with clearer policy documents a primary area for change. The DWF report, based on a survey of 403 insurance purchase decision-makers at businesses in the UK, reveals that nearly half of businesses (42%) reported that the pandemic has made them appreciate the importance of insurance policies much more. However, for 22% of businesses, some or most of their insurance policies are now seen as useless, and 15% of both groups said the pandemic has made them believe that they need less insurance cover. The report reveals that most businesses want clearer policy documents, written in plain English, with greater clarity around product information, especially more transparent explanations of any caveats or exclusions. Overall, half of businesses said the pandemic has changed their views on insurance, but opinion differed depending on the size of the business. Some 63% of smaller businesses recorded little or no change in their attitudes, compared with 52% of medium-sized businesses and 38% of large companies. DWF says in the report that in general, businesses still believe their policies meet their expectations – 92% of businesses believe their insurance policies meet their expectations either fully (61%) or partially (31%). “However, the detailed picture is more nuanced, with respondents saying that while certain types of policy meet all their expectations, others performed less well,” states the report. “Of those policies that met some of buyers’ expectations but failed on others, perhaps the most notable for business respondents are business interruption (38%), credit risk (44%) and key man (37%).” The reasons are set out as: lack of flexibility during the pandemic (44%); confusion around policy premiums and their corresponding levels of coverage (35%); and lack of clarity around policy terms and conditions (32%). Interestingly, on data, 75% of businesses feel comfortable with insurers accessing or using their company data to inform their products. However, 52% also said insurers should be more transparent around how they use this data, and 41% want insurers only to use their company data in very limited circumstances. As for pricing, surprisingly, more than a third (36%) of businesses would consider paying higher insurance premiums than originally planned, with the remaining businesses wishing to either keep the same price (48%), pay lower premiums (15%) or drop the policy altogether (1%). More than half (51%) would be willing to pay up to 10% more for better coverage and 41% would pay between 20% and 40% more. About 50% of businesses are willing to pay more for cyber insurance. Nearly all businesses (95%) claim to understand their insurance policy documents, but seven in ten (70%) businesses think that choosing and buying insurance is always a difficult process, and perhaps surprisingly, almost half (49%) of businesses claim a lack of understanding when it comes to business insurance. Claire Bowler, global head of the insurance sector at DWF, commented: “There are some parts of the research that insurers will hopefully find of interest for their product lines and development, specifically around businesses and consumers wanting a more nuanced, tailored and responsive service from their insurers.”

DWF survey finds UK firms satisfied with insurers but buying process a concern

Demand for clearer policy documents

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