General Insurance Article - Brokers expect large rise in use of credit to buy insurance

 The findings are from Premium Credit, the UK’s leading premium finance company, and show that 50% of insurance brokers anticipate the amount of credit used to buy general insurance in 2019 will be higher than the amount used last year, and only 3% anticipate it will be less. The corresponding figures for commercial insurance are 65% and 3% respectively.

 In terms of the credit facilities used, 66% of insurance brokers anticipate clients will make greater use of premium finance this year when compared to 2018. The corresponding figure for credit cards is 42%.

 When asked why they believe clients will use premium finance more this year, 58% said it was because disposable incomes for clients are falling so they are more reliant on credit. This was followed by 32% who said the cost for insurance products is increasing. Nearly a third (29%) said it was because premium finance is becoming better understood by clients.

 Nearly one in four (23%) insurance brokers interviewed expect to see a double digit percentage increase in the number of premium finance policies they sell this year when compared to 2018.

 More than half (55%) of insurance brokers interviewed for Premium Credit said that, in 2018, more than 30% of the general insurance policies they sold were bought using a form of credit, and this rises to 74% for commercial insurance sales.

 Adam Morghem, Strategy and Marketing Director at Premium Credit said: “These findings suggest that people and businesses are making greater use of credit vehicles to buy their insurance cover- though we know that many are not using premium finance.