The small and medium-sized enterprise (SME) market is both vibrant and complex offering significant opportunities and challenges for insurance providers.
As of 2023, the UK's SME sector comprised 5.5 million businesses, which is more than 99% of the UK's business population. Referred to as the backbone of the UK private sector they account for three-fifths of the employment, at 16.7 million, and around half of turnover, estimated at £2.4 trillion.
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Complex Insurance Needs and Coverage Gaps: The SME market is complex, with diverse insurance needs that often don’t fit standard cover offerings, leading to both underinsurance and overinsurance issues.
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Limited Understanding and Price-Led Decisions: Many SME owners have limited understanding of policies, resulting in price-led decisions and a lack of awareness about essential cover aspects like indemnity periods and rebuild costs.
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Trust Building: There's a strong need for education around SME insurance options, which presents an opportunity for insurers and brokers to build trust and tailor solutions to specific business needs.
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Data-Driven Insights for Deeper Relationships: Data-driven approaches provide insurers with valuable insights into SME customer needs, helping move insurance beyond a transactional relationship and fostering deeper, long-term connections.
