UK insurance customers have more trust in the banking sector and drug companies than their providers, EY has found.
In a poll of more than 23,000 insurance customers across 30 countries, EY revealed that only 7% had complete trust in their insurance provider.
The trust was found to be lower than any other European country and over 50% below the global average, according to the latest EY Global consumer insurance survey.
Graham Handy, global consumer insurance leader at EY, said: 'At a time of great upheaval across the entire UK insurance industry, with the motor market reporting unprofitability, the home insurance market not far behind, and dramatic changes to pensions, this news could not come at a worse time.'
EY also said that the Budget changes to pensions had led to annuities playing a significantly reduced role in an estimated £30bn per annum retirement market.
It said that competition to offer services to pensioners looked likely to grow from non-traditional providers chasing a piece of the pie.
Handy added that the shift to accessing pension funds through cash machines and debit cards meant that the banking industry was well placed to weigh in.
'Given the higher levels of trust placed on banks, we could easily see market share slip away from insurers if action isn't taken,' he said.
Of those polled almost a quarter of UK customers said they would likely switch insurance provider in the next year. This was due to insurance costs, policy benefits and coverage, the report stated.
UK insurance consumers are far more driven by price than their international counterparts, with over 80% stated cost as the primary reason for switching, EY said.
Around three-fifths of US insurance customers cited price as a reason, followed by 60% of French and 72% of German policyholders noting this as a cause.
Communication between customers and their insurers in the UK was very low, with just three in ten people claiming to have had interaction with their insurance company in the last year and a half.
This placed the UK in last position across Europe, the Middle East and Africa in terms of customer communication. The global average was 56% of customers having interacted with their insurers over the last 18 months, said EY.
The majority of UK customers still prefer to manage their policy enquires over the phone, but 30% said they were open to webchats and smartphone apps.
EY also noted that customers were asking for more information, and insurers should be doing more to provide it.
