Industry Analysis & Industry Trends
General insurance providers offer products including motor insurance, property and content insurance, general liability insurance, accident insurance and health insurance. The industry generates revenue by charging its customers premiums and investing this income. Over the past decade, the share of total revenue that is generated through investments has fluctuated greatly. IBISWorld expects investment conditions to be volatile over 2016-17, as a result of financial market turbulence due to uncertainty created by the UK's decision to leave the European Union.
Operating conditions at the beginning of the five-year period through 2016-17 were difficult for the industry. The poor performance of the UK economy following the financial crisis resulted in weak demand for insurance... purchase to read more
Industry Report - Industry Investment Chapter
Information technology is an important component of general insurers' operations and, consequently, accounts for a sizeable portion of insurers' capital investment programmes. IT is used for back-office functions, investment activities and retail activities. Indeed, investment in IT has eased the labour burden of risk assessment, policy pricing and historical claims analysis. In the past, many employees were needed to analyse a large body of claims and loss data, but IT now allows firms to store, aggregate, manipulate and analyse claims data better. They can then overlay this analysis on their balance sheet. This has reduced the labour intensity of this process. Commissions are not included in the calculation of capital intensity as those costs are variable.
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