Brokers’ clients cancelling cover as businesses 'feel pinch of economic crisis'

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’As an industry, we must continue to support businesses as much as we can,’ says commercial lines managing director

RSA’s latest Broker Pulse Survey showed businesses were “feeling the pinch of the economic crisis”, according to commercial lines managing director Lee Mooney.

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The survey of 202 UK brokers, which was released during the Biba conference last week (10 May 2023), revealed some 54% said that economic uncertainty was a common concern among their clients, while 42% believed this would continue to be a challenge for their business over the next 18 months.

It also revealed that with the cost of doing business remaining a “significant concern”, some 79% of brokers revealed they saw changes or cancellations made to insurance cover.

Property (27%) and employers’ liability (26%) policies were among those altered the most.

In a statement today (15 May 2023), Mooney said it was “worrying that some businesses are resorting to reducing or cancelling insurance cover, as this leaves them more exposed to any unexpected financial shocks that may arise”.

“The findings of our latest Broker Pulse reinforce that businesses are feeling the pinch of the economic crisis,” he added.

“As an industry, we must continue to support businesses as much as we can and a significant part of this involves working with brokers to provide them with the necessary insight to help them and their clients navigate this period of uncertainty.”

Broker support

Despite the challenges and the increase in policy alterations, more than 80% of brokers agreed they were generally well equipped to support clients in navigating economic uncertainty.

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However, 85% of brokers felt they would benefit from further insight and knowledge-sharing by insurers to understand the macro-economic landscape and inform long-term planning for clients.

Email reporting (47%), virtual insight sessions (42%) and roundtables or seminars (40%) were among the methods of support that brokers would prefer.

Mooney added: “We’re constantly talking to brokers to understand the challenges facing their clients, but also facing their own businesses.

“The Broker Pulse is another valuable tool we use to help us understand the issues brokers and their clients are looking at, but more importantly offer insight to help them combat these concerns.”