As 2021 draws to a close, and we plan for the next 12 months, I’ve been thinking about what’s to come.
Here are my predictions for 2022
For starters, I believe it will be a good year for brokers in the insurance industry. Whilst the FCA pricing practices changes (watch our webinar here if you need a refresher on what these are) might seem daunting, they’ll actually be a major positive for the way we do business.
There will be less movement between insurers
I forecast that consumers won’t be switching between insurers looking for the best deal, as price won’t be the main factor drawing them in anymore.
Instead, there will be a push towards a focus on loyalty and retention. This is great news for your trail commission possibilities.
Broker advice will be paramount
Consumers may struggle to understand the difference between what cover they actually need and what is an inflated limit to appear more appealing. A broker’s advice will be even more vital than ever, to help your clients see which products are inflated and which provide actual quality cover. This will also tie in with your fair value product assessments, set by the FCA.
Due to the FCA’s rules on price walking, the focus will steer more towards fair value. As insurance can be confusing for consumers, the advice of a broker will become even more valuable.
There will be more artificial cover limits
Insurers that have been reliant on price to attract new customers will need to find other ways to maintain income. Something they may turn to is ramping up cover limits, which can easily dazzle a customer into believing it’s a better policy. However, we all know more doesn’t always mean better. For example, no client will ever need £1m garden cover on a household policy (unless perhaps it’s for Alan Titchmarsh!).
An increase in claims for lost property, due to hybrid-working
During 2020, a large proportion of the UK began working from home. This continued into 2021, but we’ve since begun to see a shift to hybrid-working. This means that more people will require cover for items away from the home, such as commuting with laptops and other personal items. At present, this is an add-on for most policies, so we may see a change in what is included as standard.
Ipswich Town will be promoted to the championship!
Perhaps that’s just wishful thinking…
Whatever 2022 brings, Source will be there to help you grow your business through maximising your GI sales potential.