Research from the Chartered Insurance Institute has revealed over half (53%) of its members expect an improvement in economic performance in the next 12 months. This is a surge in expectations compared to the previous year’s figure of only 15%.
The survey of over 3,700 CII members comes amid a climate of cautious return to economic confidence. The striking increase in confidence compared to 2013 is consistent with a number of economic growth indicators that have been announced in recent months with the Bank of England recently revising its UK GDP growth predication by 3.4%.
Interestingly, there was a notable divergence amongst age groups in the degree of optimism they share. All agreed that economic prospects will improve in 2014, however the greatest optimism was seen among the youngest and oldest segments. Those aged under 25 and those over 55 are far more upbeat about the economy than those who are in the middle of their careers.
Commenting on the research, David Thomson, director of Policy and Public Affairs at the CII, said “2013 ended with a number of positive economic announcements and what we see here is the voice of the insurance industry backing the economic figures. The insurance industry has always been closely linked to economic performance and these figures, while no means surprising, are a positive endorsement of the British economy by one of its major contributors to its GDP.”
The survey also revealed that the proportion of members expecting improved business performance in their own companies has increased from 42% to 53%. The upturn in confidence, although not as marked as the economic prospects index, shows a continuing trend in member’s views that their businesses have survived the worst of the financial crisis.
Employment also saw renewed optimism with around four in 10 (39%) saying their job prospects are brighter than they were 12 months ago. With the unemployment rate falling to 7.2%, the positive outlook indicates the insurance industry may see an increase in job movers.
Continuing, Thomson, said “With renewed business and economic confidence 2014 is set to be an interesting year ahead. The industry has been gaining pace and it is likely we’ll see an increase of start-ups, acquisitions and job moves in the next 12 months.
However, the subdued increase in positivity from member’s confidence about their company’s prospects suggests that industry insiders are optimistic, but are wisely exercising caution. With this in mind, it is vital the industry pays close attention to building trust with consumers and improving professionalism within the whole industry."
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