Cyber policy sales have increased by almost three and a half times during the COVID-19 lockdown, according to SchemeServe, a UK based insurtech specialising in schemes software.
New data from SchemeServe’s Schemes Premium Index compares data for April 2020 at the height of the lockdown to data from the same period last year.
It shows that policy volumes fell across the board for most lines except cyber, contractors’ all risks, pet, residential property owners and mobile phone insurance.
Employers’ liability schemes saw the biggest fall at 80%, while caravan & trailer fell 70% and legal expenses fell 77%.
In contrast, cyber showed the biggest increase with sales up 340%, followed by residential property owners at 104% and then mobile phone insurance with an increase of 95%.
“Covid-19 has clearly had a dramatic effect on some schemes business, and there’s no surprise to see which lines have been the winners and losers bearing in mind the impact of the lockdown on current customer needs,” said Sean Neal, a member of the Advisory Board for SchemeServe.
“Schemes business will bounce back, schemes are a vital element of the insurance landscape – essential for customers and insurers alike. It has been interesting to see new growth areas in schemes springing up as a result of the changes brought about by Covid-19. The landscape might look different, but schemes are here to stay,” he continued.
“Combined with the headwinds of Brexit and a hard market already impacting many lines, the market could see some schemes that are not profitable being dropped by insurers, have commission reduced significantly or could find unsustainable rate increases being imposed.”
Neal went on: “The smart brokers will look at our specialist schemes technology to lower their costs, increase efficiency and maximise distribution. Rather than rest on their laurels and wait for rates to strengthen, brokers should meet the challenge head on – take the initiative, explore the capabilities of schemes software and tap into the new opportunities that arise. Those that need to invest in tech will need a rapid, agile solution, not something that will take 12 months or more to bear fruit.”