The last 12 months have been a tough time for insurance brokers, but personal lines are taking the brunt of it. The pandemic has caused people to hold off from expensive purchases like cars that require insurance and forced millions of people to re-think the way they travel.
Customers who have taken their car off the road in order to save money have cancelled coverage, which is just another unfortunate consequence of this terrible economic downturn.
An optimistic Bank of England believes there will be increased household spending later in the year. Although, personal lines brokers who were affected by restrictions due to pandemic fears may find it harder to get their numbers back up after the end of those restrictions.
The Office for National Statistics reported the unemployment rate fell back slightly to 5% in the three months to January, representing 1.7 million people – down from 5.1% in the three months to December.
The number of employees on furlough has risen to almost 5 million during the latest wave of the pandemic. The economy is under pressure, so this helps a little, by preventing job losses in some companies who are still able to function with less staff than usual.
However, the economy has been improving lately with the help of an increase in clear government restrictions and firms adapting to new regulations. So, there is a glimmer of hope that consumers will begin to feel more secure in their personal financial outlook.
Being competitive in the market is a must for brokers as we start to come out of lockdown. Furthermore, as consumers become increasingly dependent upon internet searches when determining what business services to use, having a strong digital presence offers smaller brokers increased opportunity for their business to compete with larger organizations who traditionally have had stronger brands.
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