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Insurers are paying out nearly 60% more in claims than they were ten years ago, according to figures published this month by the Association of British Insurers (ABI).
In 2007, paid claims totalled £22.3 billion compared to £14.2 billion in 1997. Last year's summer floods accounted for a significant increase in property damage claims and, because underwriting results for most classes of business were down, 2007 saw a general underwriting loss of £644 million, the first recorded since 2003.
The ABI's 'Key facts' report on UK insurance also highlights how the public's insurance-buying habits have changed.
In 1997, 55% of consumers who bought general insurance cover did so through a broker. In 2007, that figure had dropped to 34%. Banks and building societies, on the other hand, are selling more cover. In 2007 they were responsible for 16% of retail sales, compared to less than 5% ten years ago.
But consumers are increasingly reliant on independent financial advisers (IFAs) when they buy life insurance or sort out a pension. In 2007, 75% of business was sold by IFAs. Ten years ago the figure was 59%.
Separate figures published by the ABI this month show that the number of companies taking out credit insurance increased by 10% in 2007.
Trade credit insurance protects businesses against bad debts caused by customers becoming insolvent or defaulting on payment. Last year was the third consecutive year that the trade credit insurance market grew. Overall there has been a 40% rise since 2004.
Nick Starling, the ABI's Director of General Insurance said: "It is positive news that there is a greater awareness amongst small businesses as to the value of trade credit insurance during periods of increased risk and volatility. The economic slowdown has driven the number of policies up to near-record highs."
"While the economy is in decline, trade credit insurers expect to pay out more claims during 2008 as business insolvencies rise," he said.
In 2007, paid claims totalled £22.3 billion compared to £14.2 billion in 1997. Last year's summer floods accounted for a significant increase in property damage claims and, because underwriting results for most classes of business were down, 2007 saw a general underwriting loss of £644 million, the first recorded since 2003.
The ABI's 'Key facts' report on UK insurance also highlights how the public's insurance-buying habits have changed.
In 1997, 55% of consumers who bought general insurance cover did so through a broker. In 2007, that figure had dropped to 34%. Banks and building societies, on the other hand, are selling more cover. In 2007 they were responsible for 16% of retail sales, compared to less than 5% ten years ago.
But consumers are increasingly reliant on independent financial advisers (IFAs) when they buy life insurance or sort out a pension. In 2007, 75% of business was sold by IFAs. Ten years ago the figure was 59%.
Separate figures published by the ABI this month show that the number of companies taking out credit insurance increased by 10% in 2007.
Trade credit insurance protects businesses against bad debts caused by customers becoming insolvent or defaulting on payment. Last year was the third consecutive year that the trade credit insurance market grew. Overall there has been a 40% rise since 2004.
Nick Starling, the ABI's Director of General Insurance said: "It is positive news that there is a greater awareness amongst small businesses as to the value of trade credit insurance during periods of increased risk and volatility. The economic slowdown has driven the number of policies up to near-record highs."
"While the economy is in decline, trade credit insurers expect to pay out more claims during 2008 as business insolvencies rise," he said.
