The expanding self-storage market presents opportunities for both commercial and personal lines brokers, reports Edward Murray
Are you interested in a growing market that provides access to commercial and personal lines clients? If so, the self-storage sector is one to explore.
There are more self-storage facilities in the UK than there are McDonald’s restaurants. That is not bad for an industry that only arrived in the UK in the 1980s.
Room for expansion
There is also significant room for expansion in the 1,500 self-storage units currently available in the UK.
These units provide around 44.6m square feet of storage space, according to the Self-Storage Association UK. This equates to around 0.67 square feet per person. In more developed markets the figure is a lot higher. In Australia, for example, it is around two square feet per person, while in the US it is over seven square feet per person.
If the UK market reaches the same breadth as in the States, there will be over 15,000 facilities available to customers.
Rennie Schafer is chief executive officer of the Self-Storage Association UK and he believes future growth will continue to be underpinned by modern housing and lifestyle dynamics.
As a result, the growing market offers attractive opportunities for brokers. The first is in catering for the insurance needs of self-storage operators, the second is in helping those that use these facilities to find appropriate cover for their contents.
It is the customer’s responsibility to insure their own goods and the self-storage operators tend to remove virtually all liability for thatRennie Schafer
Schafer explains: “The challenge for the self-storage operators is that they need insurance for their buildings and their business, as well as a package they can offer to their customers to make sure that their goods are insured as well.”
Self-storage operators only provide very limited cover for the property stored within their facilities and Schafer adds: “It is the customer’s responsibility to insure their own goods and the self-storage operators tend to remove virtually all liability for that.”
When considering the needs of individual operators and the customers that use their facilities, brokers will need to explore what contents cover is already available and whether they can offer a policy and/or scheme that brings something new to the market.
Graeme Trudgill, executive director at the British Insurance Brokers’ Association is confident in the speed and innovation members have continually shown when exploring expansion opportunities and identifying where they can make a positive difference in niche areas.
He says: “If it is a growing market, then members are always very keen to look at the potential opportunities.”
If penetration levels in the UK reach those of the US, then these prospects will be very sizeable indeed.
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