Opinion: Are the days of generalist UKGI firms numbered?

Pre-pandemic, UK general insurance (UKGI) firms could often be divided into two clear camps – generalists and specialists.

While specialist businesses succinctly homed in on very particular niches of UKGI, providing detailed pockets of cover across a very precise list of risks, generalist firms were more wide-reaching and embraced a large pool of clients with myriad needs and requirements.

In recent years, however, the number of firms admitting to being UKGI generalists has massively reduced as the market continues its Russian doll style consolidation, becoming “more specialist” with every bite of the M&A apple – in addition to adopting “a strong focus on cost efficiency”.

Huw Evans, partner and head of insurance at KPMG UK, told me that he continued “to see changes in the structure of the [UKGI] market”, driven by broker consolidation and firms taking “judgment calls about which books of business they want to continue to write”.

In turn, this has led to organisations selling certain “books of business to other insurers [that have] got more of a medium-term commitment” to particular lines of business.

“[We continue] to see the market consolidate, become more specialist and for books of business to move around the market to places where they’ve got a more natural home,” he noted.

Examples of this trend are rife in the Insurance Times news archive – Axa withdrawing from the motorcycle market and Markerstudy exiting the short-term market in February 2024, Admiral completing its acquisition of RSA’s direct home and pet renewal rights in April 2024 and Direct Line Group moving away from pet and travel policies, as confirmed by chief executive Adam Winslow in July 2024.

Insurers that take on both personal and commercial lines risks are becoming more sparse – were generalist brokers and insurers, therefore, fulfilling the adage of being a ‘jack of all trades but master of none’? What was the result of this on customer service?

Undoubtedly, firms within the UKGI marketplace are increasingly becoming laser focused on the books of business that whet the very specific risk appetite.

I’d like to think this market momentum will improve transparency and provide a greater depth of service for both brokers and end customers. One thing is certain though – the days of generalist firms are numbered, if not already over, so firms that fail to find a specialist focus could struggle to succeed.