The non-standard insurance sector is forecasted to experience “unprecedented, dynamic growth” through to 2030, according to Prestige Underwriting, a specialist MGA in the market.
The Report, commissioned to Aon’s Finaccord by Prestige, assessed the non-standard market and its growth from 2023 to 2030. It provided details regarding trends that will likely affect the various segments within non-standard, the undercurrents that will spur growth overall and the size of growth expected based on fluctuations seen to date.
In the non-standard home segment, the Report revealed that modular homes are a significant driver, and stated that they are expected to grow impressively at a compound rate of 1.6% each year.
Thatched homes are also expected to witness a slower but stable growth due to their environmental credentials.
The Report also anticipates a modest 0.5% compound annual growth in second homes, a prediction aligned to the decline in holiday homes abroad.
An acceleration of 1.2% compound annual growth each year is expected in unoccupied homes from 2023 to 2030, affected by contraction of the private rental market and other factors.
However, with climate change as a factor, analysts warn that geohazard risks such as subsidence are projected to grow at a compound rate of 1.3% annually between 2023 and 2030. This means that 6.5% of all properties in Great Britain will be at risk of subsidence by 2030.
Alison Williams, Managing Director at Prestige Underwriting said: “The Report forecasts a potential era of unprecedented, dynamic growth in the non-standard market. Swift adaptability to the evolving landscape, knowledge and specialisation will play a pivotal role in manifesting a positive outcome from the projected robust growth.
“The insights provided in this Report offer invaluable guidance to insurers and brokers, equipping them with a deeper understanding of the non-standard market’s trajectory. By leveraging these insights, insurance brokers can proactively seize emerging opportunities and continue to deliver exceptional value to their policyholders in this ever-evolving insurance landscape.”
For non-standard motor, the Report suggests that there will likely be potential bottlenecks in the availability of electric cars in the UK, which could result in the resurgence of the import of grey vehicles.
The forecast indicates a compound annual growth rate of 3.3% each year for grey cars between 2023 and 2030.
Additionally, the Report also forecasts a continuous rise in both the number and share of high-performance cars, which reached 3.8 million by 2023.
Beyond 2025, the trend is expected to persist, albeit at a decelerating pace, with high-performance cars forecasted to grow at an overall compound annual rate of 7% each year between 2023 and 2030.
Carl McComb, Pricing and Actuarial Director at Prestige Underwriting, commented: “There will be significant expansion in key areas of the non-standard market by 2030 but also notable disparities, with growth exhibiting a checkered pattern across various sectors.
“Additionally, the Report emphasises, from an actuarial standpoint, that the dynamic pace of economic inequality and climate change necessitates increased adaptability within the insurance sector. Meeting the diverse needs of consumers in this volatile and evolving landscape will demand a heightened level of flexibility.”
