The development of the niche insurance sector reflects increased diversity among the UK population, as financial products no longer conform to a one-size-fits-all approach. Emerging social, technological and economic trends provide a platform for insurers to develop and launch new products in order to meet these continually evolving requirements. Niche insurance is not a cohesive financial market, but a highly fragmented and specialist sector, with differing market drivers, challenges and a variety of providers and distributors.

The main challenges faced by the sector are similar to those faced across the financial services industry – mainly consumer understanding and awareness – although niche insurance products are also forced to compete for attention alongside a plethora of mainstream insurance products. Indeed, the overlap provided by some of these products has undoubtedly limited the uptake of niche insurance products among consumers. However, Mintel’s consumer research reveals that only a quarter of adults are confident that they have adequate insurance cover, suggesting that some sectors of market have considerable scope for expansion.

This report examines a range of products that fall within the broad definition of niche insurance, as well as the issues impacting the wider insurance market. It considers the main drivers, market conditions, market size, main players and recent developments for several niche insurance products. Mintel’s exclusive consumer research is used to obtain an overview of niche insurance product ownership, consumer attitudes and potential targeting opportunities.

Key report themes:

The influence of emerging trends on the development of niche insurance products

How will the economic downturn impact the market for niche insurance?

Who are the main providers and distributors of niche insurance products?

How will the growing influence of direct insurance products and aggregators impact the niche insurance sector?

To what extent do mainstream insurance products overlap with the cover provided by niche insurance products? And how does this impact the consumer perception of the market?