Ecclesiastical is doubling its Scottish team to meet rising demand from new business activity – but it’s an area that won’t be without its challenges.
“The geography of Scotland presents some unique risk management challenges, due to the remoteness of some properties and businesses,” Andy Williamson (pictured), regional director for the Northern region at Ecclesiastical, said.
A recent Scottish Government report found that 11% of Scottish companies are based in remote rural areas, with another 13% in accessible rural locations.
Williamson believes this underscores “the importance of local specialist risk management teams who can provide tailored advice to clients regarding fire and security protections.”
Scotland’s built environment and economic makeup continue to shape its insurance needs. “Scotland has a significant number of heritage properties, with circa 47,000 listed buildings. As specialists within this field, this makes it an important market,” Williamson noted.
Climate change is also increasing risk exposure for these properties. In 2024, “UK insurers paid out a record £585 million for climate-related damage to homes and belongings - £77 million more than the previous record”, according to The Guardian.
On the commercial side, the Scottish economy is diversifying rapidly. “Heavy manufacturing is nowhere near as prevalent as it was,” Williamson said, “and has given way to a much more diverse economy, including food and drink manufacturing, oil and gas, professional business services, and scientific and technical sectors. Financial services and wholesale/retail also play a significant role in exports to the rest of the UK.”
This diversification is backed by the Scottish Government’s Q4 2024 trade report, which noted “ a sharp fall in exports of organic chemicals - accounting for a quarter of the total decline - alongside drops in power-generating machinery and road vehicles…”
However, “drink remains Scotland’s leading export, making up 27% of international goods exports and 21% of EU goods exports.”
Given these challenges and market shifts, brokers need to adapt their services to meet Scotland’s growing demands.
To better support the diversified Scottish market, brokers can offer:
Scotland’s insurance broker landscape is also undergoing major change, with mergers and acquisitions at the forefront. “The insurance broker landscape has seen huge changes over recent years due to M&A activity, with global and national brokers actively targeting local independents and then centring functions mainly in Glasgow, Edinburgh and Aberdeen (where offshore is still prevalent). Independent brokers in Scotland are now few and far between,” said Williamson.
Insurers are adjusting too, with many centralising operations. “Many major insurers have closed down regional branches, favouring single multi-function locations - typically in Glasgow’s financial district,” Williamson explained.
With insurers mobilising and consolidation accelerating, Williamson sees a growing need for closer engagement and specialisation.
Some sectors within Scotland’s insurance market, however, are becoming more competitive.
“Whilst a number of inflationary pressures remain, it’s clear Scotland and the wider UK are moving into a new phase of the insurance cycle - some, but not all, markets are seeing increased competition,” Williamson said.
However, he warned against letting price alone dominate client conversations. “We all know that in this next phase, competition increases, and premium rates run below claims inflation, until it cannot be sustained and the cycle continues. In these challenging conditions, we should not allow price discussions to drown out the quality of product, service and advice as an important dimension.”
Williamson concluded with a reminder that value must be actively demonstrated: “Tailored coverage, a natural alignment and affinity to clients, long-term partnerships, risk management expertise and bespoke claims skills all help - but in a noisy and transitioning market, it requires focused effort to bring these to the fore.”
