Core Insights - The primary concern for UK SMEs is not underinsurance, as only 14.5% express being very concerned about it, ranking it lowest among 23 assessed risks [2][3] - The most pressing issues for SMEs include the cost-of-living crisis (31.3%), revenue generation (27%), and political changes (25.7%) [2][3] - A significant 74% of SMEs globally are underinsured, indicating a disconnect between perceived risks and actual coverage needs [4] Group 1: Underinsurance Concerns - Only 14.5% of UK SMEs are very concerned about being underinsured, making it the least concerning issue [2] - Hiscox's report indicates that 74% of SMEs worldwide remain underinsured, with 55% lacking essential coverage types [4] - A large portion of SMEs lacks understanding of key insurance types, with 77% unable to describe cyber insurance and 80% for professional indemnity [4] Group 2: Operational Focus - UK SMEs are primarily focused on immediate operational challenges, which leads to deprioritization of long-term financial risks like underinsurance [3] - The lack of concern for underinsurance may stem from unfamiliarity with comprehensive protection and evolving risks [5] - Many SMEs have not reviewed their insurance policies in over three years, indicating a gap in awareness and understanding [4] Group 3: Opportunities for Insurers - There is a clear opportunity for insurers and brokers to provide targeted solutions to address the underinsurance issue [5] - Proactive coverage reviews and simplified product explanations can help SMEs identify and understand their coverage gaps [5] - Enhancing education and transparency around insurance options is essential for reducing the protection gap and safeguarding SMEs [5]

Core Insights - Verisk has launched Commercial Rebuild, an underwriting solution aimed at providing U.K. commercial property insurance specialists with a customizable model for accurately assessing the rebuild value of small- to mid-market commercial buildings [1][6] Industry Context - The launch comes at a critical time as underinsurance is a significant concern, with a report indicating that nearly 46% of commercial properties in the U.K. are estimated to be underinsured [2] Product Features - Commercial Rebuild allows for remote estimation of reinstatement costs without the need for site visits, using just an address to calculate costs for various commercial premises [3] - The solution combines a tailored surveyor model with high-quality data and technology to help insurers, brokers, and MGAs calculate reinstatement costs more efficiently [4][6] - Key features include minimal input requirements, access via real-time API or web-based portal, and a regularly updated detailed rebuild cost model to align with changing material and labor costs [7] Operational Benefits - The system aims to provide high-quality estimates that align with building industry valuations, making it more economical for insurers to cover small- to mid-market commercial properties [6] - By leveraging comprehensive property datasets and technology, the solution enhances customer satisfaction and simplifies workflows for insurers, MGAs, and brokers [6][8]

Core Insights - A significant number of California homeowners are underinsured, risking insufficient funds to rebuild their homes after disasters [2][3] - The issue of underinsurance is exacerbated by rising construction costs, increased wildfire risks, and market adjustments in the insurance sector [4][5][7] Underinsurance Statistics - Approximately 806,600 residences in California are completely uninsured, representing 10.5% of all homeowners [3] - The use of the California FAIR Plan, a basic fire insurance option, has increased by 300% since 2018, now covering 4% of the state's homeowners [6] Factors Contributing to Underinsurance - Rising insurance costs in wildfire-prone areas are leading homeowners to underinsure or let their coverage lapse to reduce premiums [5] - Increased frequency and severity of wildfires are making it more challenging and expensive to insure homes [7] - Regulatory constraints from Proposition 103 complicate insurers' ability to adjust rates in response to evolving risks [8] Policy Considerations - Understanding the difference between actual cash value and replacement cost policies is essential for homeowners to ensure adequate coverage [9] Recommendations for Homeowners - Homeowners can reduce wildfire risk through property mitigation strategies, which may lower insurance costs and qualify them for discounts [10] - The state is implementing changes to improve insurance availability and affordability in high-risk areas, as seen in the Sustainable Insurance Strategy introduced by the Insurance Commissioner [11]