2017 niches

We still live in a world where traditional insurance policies are a necessity. The millions of home owners who require building cover, and the millions of car owners who still require motor insurance, for example.

And while the market will continue to serve these traditional needs, we need to recognise that changes in behaviour, environment, and technology – in some cases, dramatic changes – have highlighted new insurance needs, and new challenges to which the industry has needed to rise.

In this post, we’ll take a moment to examine these changing circumstances, and how they may give rise to new niche insurance opportunities over the coming year and beyond.

Experience over Stuff

One of the commonly held notions about modern consumerism, and how it differentiates from previous eras, is the move away from the purchasing of ‘stuff’ towards spending on ‘experience’.

It’s likely due to a variety of factors, among them:

  • Millennial numbers surpassing ‘baby boomers’
  • Lower disposable income
  • Reduced lending opportunities
  • The influence of social media, promoting aspirational lifestyles over material commodities
  • World events & unpredictable socio-political climates

Whatever the reasons, these lifestyle and spending shifts open up new avenues for the insurance market.  New innovations in the way we travel – such as Uber and AirBnB – highlight insurance considerations that a wider public need not have previously considered.

For instance, Uber have been resistant to calling themselves a private hire company, but their drivers still require some form of public-liability insurance, if they are carrying passengers. As more businesses adopt this car-share style policy, or other communal service start-ups, will these types of liability cover take on wider prevalence.

Similarly, those opening up rooms to travellers via the AirBnB platform are likely to find that traditional cover may need supplementing with some form of insurance to protect their host status.

Cyber-Security

It’s hard to envisage a larger threat to businesses all over the world in 2017 than that posed by cyber-threats. We all know and read about the cyber-threat; everything from Tesco Bank, to Yahoo and even (allegedly) the US Presidential election has seen some kind of nefarious activity.

And yet, among UK SMEs, it’s a threat that seems to have as yet gone largely unheeded, with upwards of 75% of small and mid-sized business owners admitting they have no cover for attack, hack or IT failure.

Well, one assume this will have to change. Internet breaches can cost a business in excess of £100,000 (and that’s being conservative), enough to land a crippling blow to many an organisation.

Add on the reputational and trust impacts that follow on from a decisive attack, and this is a risk that business owners and the insurance industry cannot ignore.

Environmental Changes

Certain political figures may be turning their nose up at talk of climate change, or other environmental impacts; but event of recent years suggest the likelihood of increased demand for specialist cover against climate and weather related incident.

The floods of recent years have had a devastating impact on great swathes of England, Scotland and Wales; with many unfortunate homeowners hit multiple times.

FloodRe, the not-for-profit scheme to assist those vulnerable and previously hit by flooding, was endorsed by the industry in 2016, and one can only envisage further development of ethically-driven initiatives to help those effected most by inclement changes to our climate, in the years to come.

New Niches Offer Opportunity

Traditional insurance markets, selling traditional products, are crowded, competitive places; dominated by the biggest names in the game.

Niche markets fill the gaps; providing solutions to those areas that emerge from changing habits, emerging risks, or evolving environments.

Of course, there have always been those specialised policies within the wider market. But as society changes, so influenced by social media and technology, so there emerges new challenges, new risks and new opportunities. From the way we protect our twenty-first century lifestyles in the physcial world, the way we protect our identity, integrity and businesses in the digital.

The 3 Second Pay-Out – Don’t Believe the Hype

Did you the hear the one about the 3 second insurance claim pay-out? The was the much-vaunted message from Lemonade, the new-kid-on-the-block, [...]
Read More!

What the Marsh Acquisition of Bluefin tells us about the current market

It’s not a bolt out of the blue(fin) by any means, given that it was announced back in November. But this week saw the completion of Marsh’s [...]
Read More!

How automating common processes boosts scheme success

Businesses are always on the look-out for ways to improve efficiencies in their business.  A way of simplifying their operation, of speeding up [...]
Read More!

What on earth is .Net framework and why should I care?

Continuing our delve into all things technological, this article is going to look at the fundamentals of the .Net framework. Why? Because it’s [...]
Read More!

Keeping Up Appearances While The Talent Drains Away

Here’s a quote from an article in the Guardian, from back in September: “If you work in insurance they won’t let you through the door of [...]
Read More!

The new IPT increase is 12% Lunacy

The new insurance protection tax (IPT) increase is a joke. A farcical, nonsensical and overtly harsh measure that will adversely affect [...]
3 Comments - Read More!

How might the Trump victory affect the Insurtech sector?

From reality TV to real-life reality, Donald Trump is going to be the next President of the USA. In an election campaign that was as unlikely as [...]
2 Comments - Read More!

How do you solve a problem like Millennial?

That’s a tricky one, isn’t it? After all, those people who had the audacity to be born somewhere between the early 80s and mid-to-late 90s [...]
1 Comment - Read More!