New 'non-standard' Motor insurance product launches on Aviva Marketplace

In 2020 the UK motor insurance market recorded its best underwriting profit since records began, with a Net Combined Ratio (NCR) of 90.3%, according to Ernst & Young’s latest UK Motor Insurance Results.1

Fast forward to 2022 where the NCR is predicted to return to a loss making 112%, with claims costs expected to be 25% higher than in 2021, due to the lockdown in the first part of this year.2

Underlying inflation, premium rate falls, and costs associated with the FCA’s General Insurance Pricing Practices Review will also impact profitability. Couple all the above with the FCA paper on General Insurance Pricing Practices requirements in January.

A lot can happen in a month or even a week in the motor industry, and Prestige Underwriting are excited to be re-launching their non-standard Motor and Commercial Vehicle proposition taking into consideration the impact of Covid-19, market activity and fair pricing. Their new Non-Standard Motor and Commercial Vehicle insurance product is the latest addition to our ‘hard to place’ product set on Aviva Marketplace.

“We are thrilled to be back in the Great British motor market, providing our new solutions to brokers in the non-standard space at a time where underwriting footprint and adaptability could not be more important.  We have listened to the market and focussed these new products on areas that not only fall comfortably within our expertise but also can cause a challenge when securing a placement”. Tim Baxter, Head of Broker Development, Prestige Underwriting

Prestige have refreshed and rebranded their non-standard Motor and Commercial Vehicle proposition. One thing that has been abundantly clear to Prestige following more than 5 months of trading under their belt is that the demand, with their established network of brokers, is as strong as ever.

“We are delighted with the response from our broker community and the new members that have joined post launch, the support has been really overwhelming”. David Howard, Head of Motor Underwriting

What need is it addressing in the marketplace?

With an expansive appetite for niche and the ability to secure cover for the harder to place risks, Prestige Underwriting has recorded strong growth in its non-standard motor insurance book since launch in November 2021. Analysis of the new business book indicates significant growth for a range of non-standard risks including grey imports, performance cars and convicted drivers to name a few. 

The MGA’s High-Performance scheme will take vehicles with a high ABI vehicle group such as Porsche, Maserati, Mercedes AMG and BMW M Sport models, Audi and Jaguar XF, E & F Pace models etc.  Given the associated higher risk of these high-powered cars, Brokers often struggle to secure cover for their policyholders. At Prestige Underwriting the team are delighted to address this gap in the market, providing value to its Broker network.

Performance cars come in all shapes and sizes as can be seen in the top 10 as presented by Auto Express3 in their review last July and include many of the top brands covered under Prestige’s scheme.  Open to Drivers aged 30-70, vehicles groups 34 to 50, up to a value of £100,000. Vehicles with an ABI group of 45 – 50 are also acceptable subject to a minimum ownership period of 12 months. 

Another area of steady growth since launch has been the Convicted Driver scheme. This niche product provides a solution for drivers with a poor history of motoring convictions and even certain non-motoring offences which often make it difficult to find cover elsewhere. A driver with a criminal conviction typically will find it harder to find insurance compared to a driver with a ‘clean’ record and often insurers will refuse to quote for a customer with any convictions.

Prestige’s Private Car product is suitable for Convicted Drivers aged 30 to 70 and vehicle’s less than 12 years old. What’s more the Commercial Vehicle product is suitable for Convicted Drivers aged 25 to 70 on any age of vehicle. Convictions range from 2 or more speeding offences, 2 or more Traffic Direction or signs offences, any other motoring offence, any driver with a history of motoring convictions, penalty points or disqualifications, any driver with non-motoring (criminal) offences upon referral to the team.

According to the Police Powers and Procedures report published by the Home Office in March 20204, there were 2.7 million motoring offences recorded in 2019 which resulted in a Fixed Penalty Notice or another outcome, an increase of 7.2% compared with the previous year and continuing an upward trend since 2017.  Furthermore, according to the UK Government over four-fifths (85%) of recorded motoring offences were for speed limit offences (2.3 million) The number of speed limit offences has increased gradually year-on-year since 2011 and now stand at the highest level recorded.

As statistics prove, there's an insurance market need for convicted motorist insurance and with the sales of performance cars in the UK in the ascent, it looks like Prestige Underwriting’s new motor products will provide much needed cover for the harder to place, niche risks.

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