Here’s some bad news for insurance brokers. If figures from a recent PwC survey are anything to go by then it looks like digital is the way to go for insurers if they want to win the business of small- and medium-sized enterprises (SMEs).
PwC’s survey of 2,100 small businesses across the world included 300 from the UK, and findings show the challenge is even bigger for British brokers. Almost half (46%) of the UK-based SMEs said they have purchased insurance online, compared to the 24% global figure.
If you’re a provider looking to snap up businesses which are planning to switch insurers in the next five years, then you should know that 68% of UK firms with less than 50 employees said they would go online to purchase their next policy.
In addition, 60% of small businesses below five years old want the digital route, compared to only 44% for older SMEs in the UK – those aged over 10 years, which PwC said tend to have deeper relationships with brokers.
“Insurance purchasing behaviour within small businesses is strongly driven by the existing buying habits of their founders, meaning where personal insurance goes, business insurance will follow,” noted PwC. “Of the UK survey respondents who buy their personal insurance online, 64% say they would prefer to buy their business insurance online too.”
Steven Gough, insurance director at PwC, said small businesses with single owners or managers reflect the behaviours of their founders. “As in their personal life, time-starved owners turn to digital channels to find the right insurance cover for their new venture,” he commented.
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