Insurers paid out around £77 million a day in insurance claims, statistics released by the Association of British Insurers (ABI) show.
The UK has the largest insurance and long term savings industry in Europe and the third largest in the world. As well as paying out millions to consumers and businesses every day, the industry contributes £29 billion to UK GDP and pays £12 billion in tax.
In 2013, among the 27 million UK households:
- 20 million had contents cover
- 20 million had motor insurance
- 17 million had buildings cover
- 1.9 million had some form of private medical insurance policy
- 5.7 million had whole of life insurance
- 2.3 million had a personal pension
- 0.3 million had income protection.
The study also shows the pattern of payouts across different areas:
- £27 million went to repair vehicles and cover injury claims
- £13 million was paid to cover property claims by households and businesses
- £9 million went to helping people cope with unexpected financial difficulties through income protection, life insurance and critical illness cover
- private health insurance paid out £7 million.
The way that consumers purchase products differs for insurance and long term savings products. While 52% of motor insurance and 24% of property insurance are purchased directly or through a price comparison site by the consumer, 75% had advice when purchasing a pension or other long term insurance product.
Huw Evans, director general of the ABI, said:
“From helping people and businesses after an unexpected event, to saving for their retirement, the insurance and long term savings industry plays a crucial role to help families and businesses through the financial challenges of life. Insurance means that people and businesses are not alone and have peace of mind to go about their daily lives.
“However, there is some work to be done to build confidence in products, tackle underinsurance and help more people understand the value of protecting themselves.”