What kind of insurance is too expensive?

Discussion in 'General Business Forum' started by mSure, Aug 11, 2019.

  1. mSure

    mSure UKBF Newcomer Free Member

    5 0
    Hi everyone,

    I'm looking to start a mutual insurance company for businesses that struggle to get insurance at a reasonable price. Do you mind sharing situations where you looked for a particular type of cover and decided not to buy it because it was too expensive?

    It would be super helpful for validating my project.

    Thank you!
     
    Posted: Aug 11, 2019 By: mSure Member since: Aug 11, 2019
    #1
  2. JEREMY HAWKE

    JEREMY HAWKE UKBF Legend Full Member

    3,966 1,262
    The established commercial brokers already bring the lowest prices and I would struggle to understand how a new start up would bring discounts without a reduction in cover.

    We don't look at cover and decided not to buy it . If insurance costs rise then this is just passed on to the end customer if you cant find the equivalent cover cheaper
     
    Posted: Aug 11, 2019 By: JEREMY HAWKE Member since: Mar 4, 2008
    #2
  3. fisicx

    fisicx It's Major Clanger! Staff Member

    30,593 8,983
    If they can’t get insured at a reasonable price it’s usually because they are high risk. Assuming you aren’t doing your own underwriting how are you going to find someone prepared to accept the risk?
     
    Posted: Aug 11, 2019 By: fisicx Member since: Sep 12, 2006
    #3
  4. Mr D

    Mr D UKBF Legend Free Member

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    To answer your question OP - any insurance that cannot be afforded.
    Take a small business, turnover say £500 a month. Owner decides to set up business insurance for the business.
    For what is wanted maybe you work out its £750 a year. The business owner may say no, too expensive.

    For a business with £10k a year profit the same quote may be ok great where do I sign?
     
    Posted: Aug 11, 2019 By: Mr D Member since: Feb 12, 2017
    #4
  5. ImranR

    ImranR UKBF Contributor Free Member

    46 5
    Most policies nowadays are sold as packages stacked high and sold at low prices. Most Insurers would be broke very quickly if they relied on the premiums alone to make a profit. They usually have an investment arm to make the real money.
     
    Posted: Aug 11, 2019 By: ImranR Member since: Nov 8, 2018
    #5
  6. Mr D

    Mr D UKBF Legend Free Member

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    So how do they get the money to have an investment arm?
     
    Posted: Aug 11, 2019 By: Mr D Member since: Feb 12, 2017
    #6
  7. Scalloway

    Scalloway UKBF Legend Free Member

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    Posted: Aug 11, 2019 By: Scalloway Member since: Jun 6, 2010
    #7
  8. mSure

    mSure UKBF Newcomer Free Member

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    I have two ways in mind:
    1) A model that assesses risk more accurately.
    2) Offering services to the customer that reduce its risk profile. For example, you could offer free cybersecurity assessments to make customers more aware of the most relevant attack vectors for them, which in term will make them put more protections in place for those risks.
     
    Posted: Aug 11, 2019 By: mSure Member since: Aug 11, 2019
    #8
  9. mSure

    mSure UKBF Newcomer Free Member

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    From the premium income.
     
    Posted: Aug 11, 2019 By: mSure Member since: Aug 11, 2019
    #9
  10. mSure

    mSure UKBF Newcomer Free Member

    5 0
    That's the case with low-risk policies lines like personal auto or health insurance. With higher-risk ones like cyber insurance there's a lot more focus on underwriting profitability.
     
    Posted: Aug 11, 2019 By: mSure Member since: Aug 11, 2019
    #10
  11. Mark T Jones

    Mark T Jones UKBF Big Shot Full Member

    3,266 952
    All insurance is too expensive

    Until you need it, when you will discover you have under-paid.
     
    Posted: Aug 11, 2019 By: Mark T Jones Member since: Nov 4, 2015
    #11
  12. Mr D

    Mr D UKBF Legend Free Member

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    So the insurers won't go broke relying on the premiums then.
     
    Posted: Aug 11, 2019 By: Mr D Member since: Feb 12, 2017
    #12
  13. Noah

    Noah UKBF Ace Free Member

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    Here you go.
     
    Posted: Aug 13, 2019 By: Noah Member since: Sep 1, 2009
    #13
  14. Mr D

    Mr D UKBF Legend Free Member

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    Thanks but mSure had already responded to refute ImranR's claim.
     
    Posted: Aug 13, 2019 By: Mr D Member since: Feb 12, 2017
    #14