The UK market for general insurance can be split into two areas,
the domestic insurance market and the London market. The London
Market is further split into Lloyd’s and the Company Market.
The domestic market is a direct insurance market split
between a mass market, dealing for example with the needs of
individual house-holders and motorists, and a more specialist
market catering for the more sophisticated needs of the business
community and offering cover for all manner of commercial and
financial risks.
The London Market is largely international and on a larger
scale, incorporating reinsurance. But there is an element of
overlap; for example Lloyd’s has syndicates that write motor
business which is largely domestic. More detail in
GIM1230.
Companies may operate through brokers or agents, through a
direct sales force, or direct with the policyholder through the
mail, telephone or Internet. A private policyholder, then, may
obtain cover in a variety of ways, directly from insurance
companies operating through a network of branches or agents, or
indirectly through a broker from either a corporate insurer or a
Lloyd's syndicate. Lloyd's business must be placed through
authorised Lloyd's brokers. Prospective policyholders cannot
approach a Lloyd’s syndicate directly, though some motor
syndicates run their own distribution chain.
Small commercial risks may be handled in much the same way
as private risks. A large commercial concern with complicated needs
is likely to have its own insurance department and/or risk manager
who will assess the concern's insurance needs, including the extent
to which risk should be retained. Large groups may operate their
own captive insurer – see
GIM11000.
Apart from compulsory motor insurance, UK residents are free
to obtain insurance from insurers outside the UK, and since 1 July
1994 there has been a single market in insurance throughout the EEA
with no national boundaries.
