Insurers failing non-standard risk customers – Prestige Underwriting

The practice of insurers and price comparison websites (PCWs) declining non-standard risks at the quotation stage is becoming increasingly untenable.

That was according to the results of managing general agent (MGA) Prestige Underwriting’s Non-standard Survey.

The results revealed that 88% of surveyed brokers believed insurers and PCWs should refer customers with non-standard risks to specialists that can meet their needs.

Approximately 20% of home insurance quote inquiries are declined by insurers and PCWs due to their inability to accommodate non-standard risks.

Findings also showed that over three quarters (79%) of brokers had seen more non-standard insurance enquiries over the past year.

Prestige said the anticipated growth could primarily be attributed to an expected rise in the number of customers entering the non-standard market.

The Prestige Underwriting Non-Standard Survey, commissioned from Context Skythorn, polled 65 brokers in the non-standard market between 9 and 27 May 2024.

Signposting

Prestige explained that, despite insurers inability to accommodate non-standard risks, there was little to no referral to providers who could assist, leaving many consumers without adequate options.

Tim Baxter, head of broker development and partnerships at Prestige Underwriting, said: “For many insurers, the risk profile of non-standard customers falls outside their underwriting footprint.

“We encourage insurers facing this situation to enhance their service provision by implementing a swift and efficient signposting solution.”

For example, broker body Biba operates the Find Insurance Service, which uses a search function to point people to a member broker, while the contact centre will triage callers seeking insurance and put them through to a business that is most likely to be able to help.

Baxter added: “This approach would not only offer commercial benefits to insurers but, more importantly, would address the unique needs of non-standard customers, ensuring they can access appropriate insurance policies to meet their requirements.”