The UK general insurance sector is demonstrating resilience following a substantial disruption linked to what has been identified as the most extensive IT outage ever recorded. This incident, occurring on July 19, stemmed from a problematic Windows update by CrowdStrike, a company that experienced a significant technical failure affecting global industries, including the UK motor and home insurance markets.
CrowdStrike’s founder and CEO, George Kurtz, issued an apology stating that the outage resulted from a defect in a Falcon content update for Windows hosts. He clarified that Mac and Linux systems were unaffected and assured that this incident was not a cyberattack. “We are working closely with affected customers and partners to restore all systems, ensuring you can continue delivering essential services,” Kurtz said.
Consumer Intelligence has been closely observing the fallout of this event on the UK insurance industry. The outage led to notable disruptions, including issues with registration look-ups, underwriting alterations causing significant price increases, and reduced quotability across several brands.
In the home insurance sector, 17 brands experienced price hikes on the day of the incident, with four brands seeing average premiums rise by between 32% and 65%. One insurer reported an increase of £439 in the average annual premium. These spikes were partly due to the unavailability of key underwriters.
Despite these setbacks, the home insurance market showed signs of a quicker recovery compared to the motor insurance sector. By July 20, home insurance prices began to stabilize, although ongoing analysis is required to gauge the long-term effects fully. Quotability in home insurance initially dropped but rebounded by July 21.
In the motor insurance sector, 25 brands also faced price increases, driven by manual registration searches due to look-up failures and changes in underwriting availability. Quotability fell on July 19 but was less severely impacted than in home insurance, with only two brands experiencing significant issues before recovering the next day.
Aside from pricing and quotability challenges, some brands continue to face difficulties with their contact centers and live chat services, according to Consumer Intelligence.
