The Big Trends Driving Change In The UK Insurance Industry

The insurance industry in the UK is one of the most profitable investment vehicles in the world. But even an industry as big as this one is subject to change and must adapt to survive.

In the wake of the COVID-19 pandemic, all businesses are reassessing their operations and thinking about doing things in a new way, and insurance is no different.

The introduction of new technologies, as well as the legal implications of Brexit, are also having an impact. As a result, it’s likely that we will see big changes in the insurance industry in the UK over the next few years. These are the trends that are likely to emerge.

Changes To The Regulatory Framework

Britain’s exit from the EU is impacting businesses across the board. For the insurance industry, it means that there is more regulatory freedom. So, companies will be able to make changes without oversight from the European Commission. However, deregulation comes with risks because it can impact market access overseas, so no major moves have been made yet. The Financial Services Bill has given more powers to regulators and their priority is still to protect the interests of customers.

The regulators have been vocal about the fact that they think softer measures have not been effective enough and they are drawing up new plans for the industry. Exactly what changes will be made is not clear, but over the next few years, a new regulatory framework will be introduced and this could have far-reaching effects.

The Introduction Of The Blockchain

The blockchain is changing the way many industries operate. For this reason, it’s becoming more common in the insurance industry. This means that all transactions will be automated on a ledger system and this could make things much faster and more efficient.

It would also reduce costs throughout the supply chain because there would be no need for middlemen like brokers or third-party administrators (TPAs). By using a private blockchain, insurance companies can drastically increase security and efficiency. Although the technology is still relatively new, it is becoming more common and it’s likely that it will be the standard in insurance in the next few decades, if not before. 

Reflections On The Role Of Insurers

During the COVID-19 pandemic, many people questioned the role of insurers. During a crisis, when people needed support from their insurance cover the most, the industry was not very proactive in contacting people and giving them guidance. Many companies were also reluctant to pay claims, citing the unusual situation and claiming that it was not covered. This left a bad taste in the mouths of customers who are now wondering what the role of insurers is if they can’t protect them during a big crisis. 

The industry must reflect on this in the coming years and think about how they can be more proactive in the event of a crisis. The government has also been pushing for this because it doesn’t want insurance companies to neglect their customers as they did with COVID-19. 

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These are some of the big trends that are driving change in the insurance industry right now.