Insights from TaxiPoint readers show that the UK taxi industry is facing significant challenges amid soaring premiums. Meanwhile, GlobalData surveying has found that the main reason SMEs switched providers on their fleet insurance in 2023 was because of the new provider’s pricing consideration.
As per GlobalData’s 2023 UK SME Insurance Survey, 37.5% of SMEs with commercial fleet insurance (two or more cars) switched providers because of the new provider’s pricing consideration. Other main reasons SMEs chose to switch providers included the new provider’s added risk management services (12.5%), their level of cover (10.4%), and their reputation (10.4%).
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Insights from TaxiPoint readers point to a growing issue for taxi drivers dealing with substantial increases in insurance costs. Some drivers have experienced a jump from £1,050 to as much as £1,860 in premiums. This trend is not isolated, with other taxi operators reporting similar hikes—examples include premiums rising from GBP1,260 to £1,765 and from £1,080 to £1,450.
This rise in costs highlights financial challenges within the motor insurance market, driven by factors such as high inflation and increasing material costs. These elements have hit insurers harder than expected, compounded by a notable increase in claims frequency, further adding pressure to the industry. In response to these mounting operational costs, taxi operators may be forced to pass on the financial burden to customers through fare increases. As taxi operators grapple with these financial pressures, finding a balance is essential for sustaining their services in a competitive market. Overall, insurers stand to gain by recognizing the pivotal role of pricing considerations, particularly for SMEs seeking fleet insurance for their taxis. As highlighted by the trend of SMEs switching providers, the appeal of new providers often hinges on their ability to offer more competitive pricing. By addressing this need and leveraging innovative approaches, such as telematics policies, insurers can not only attract new business but also establish long-lasting partnerships with their customers.
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