As we move through 2026, the UK insurance market reflects a mix of resilience and caution. While 2024 delivered strong underwriting results, the trajectory through 2025 and into 2026 shows margin pressure returning as claims inflation and cost complexity outpace pricing. Broader economic stabilisation has not fully translated into cost relief for insurers, as embedded inflation in repairs, construction, and supply chains continues to shape premiums.

Buildings Insurance 

Premium pressure remains high as reinstatement costs, driven by inflation in materials, labour, and supply chains, continue to shape pricing. Despite stabilising headline inflation, cost increases from previous years persist, impacting property cover. Businesses that have not updated valuations risk paying premiums that don’t reflect true exposure and facing reduced claims under average clauses.

Underinsurance is widespread, particularly for commercial premises with specialist equipment, where inflated material costs and long replacement lead times widen the protection gap. Business interruption policies often compound this risk, with indemnity periods too short for modern supply chains and contingent exposures underestimated.

Life and Key Person Cover 

Life insurance and protection products remain essential for individuals and businesses, as the insurance market adapts to shifting demographics and expectations. Consolidation among insurers in recent years has narrowed competition in some segments, yet service quality and claims responsiveness continue to hold up. Products should shift toward solutions that go beyond traditional coverage, offering options such as wellness and preventive care programmes, telemedicine, lifestyle-linked rewards, and integrated financial planning tools. These innovations give insurers a strong opportunity to engage under-40s, who increasingly seek policies that deliver real value throughout the term, not just at claim.

Cyber Insurance and Risk Sentiment 

Cyber risk was a major focus for UK businesses in 2025, driven by rising ransomware attacks, supply chain vulnerabilities, and data regulations. Several high-profile cyber incidents made headlines during the year, reinforcing the urgency for robust protection and response planning.

Our sentiment survey results below demonstrate how UK organisations perceive the near-term threat. The headline insight is that four in five businesses express at least some concern, but preparedness is uneven. Smaller firms that are unconcerned remain highly exposed.