Lowest price is key business insurance buying factor

According to new research recently published by QBE Survey, the key factor in purchasing business insurance is price in comparison to broker and insurer advice.

The survey found that a full 75 per cent of small and medium-sized businesses in the UK stated that competitive price points is the most important thing when it comes time to shop for commercial insurance.

One out of three businesses would rather buy their cover directly from an insurer rather than from a broker, the survey additionally found.  Moreover only 16 per cent of SMEs in the UK stated that they availed themselves of the professional indemnity insurance industry for advice during the first half of last year.

The research survey’s findings indicate that many businesses in the UK may be making their operational decisions with cost constraints brought about by the recession in mind.  This supposition was highlighted by the 71 per cent of respondents that believe it will be reasonably difficult if the current economic climate in the country were to remain unchanged.

Regionally price concerns were the primary motivating factor across the UK save in Wales and the Midlands.  The two regions instead ranked their top concern as the insurer’s financial security. In remaining regions this concern was eclipsed by the desire to obtain a competitive price quote instead.

One of the most surprising findings of the survey was that one third of SMEs in the UK would happily receive their cover directly from an insurer if it meant a reduction in cost, thus bypassing the commission fees charged by brokers.  Moreover 10 per cent of firms expressed uncertainty of the benefits a broker service could provide them, which has led industry experts to suggest that these benefits are not being explained adequately to these SMEs by their current insurance provider.

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