Student Metrics: Banking and Insurance for Students in the UK

Table of Contents

0.0 EXECUTIVE SUMMARY

• Over half of students with a bank account have signed up to a student banking package
• Several banks appear to be punching below their natural weight in the student banking market
• Students choose the provider of their main bank account in a variety of ways
• Students are least satisfied with the personal contact received from a named banking manager
• Among major banks, NatWest is generating the most satisfaction among its student customers
• Well over a third of students have taken out a credit card and 12.0% are using a bank loan
• The Student Loans Company accounts for the majority of student non-mortgage debt
• On average, resps. believe that they will take almost five years to pay off their student debt
• … although the likely time to repayment clearly varies in accordance with the subject studied
• A variety of dist. channels and interfaces are used for purchasing student contents insurance
• … although this makes up only a small prop. of total student expenditure on insurance in the UK
• … with motor insurance, sports insurance and travel insurance also featuring prominently
• … adding up to a total market for insurance bought by students that lies in excess of £500 million

1.0 INTRODUCTION

• Research rationale
• The report offers the most comprehensive research ever published on student financial services
• … with the market of immediate and strategic importance to both banks and insurance companies
• Research sample
• Research methodology and structure
• Finaccord
• Student Metrics and other consumer-focused studies
• UK affinity and partnership marketing publications
• IPT / Tpoll

2.0 STUDENT BANKING

• Introduction
• Over a quarter of students hold more than one current account
• … with many of these classifying their main account as a specifically designated student account
• Two banking groups together account for over 45% of main current accounts used by students
• Almost a third of students choose their current account provider simply by following their parents
• Around one half of students make use of an overdraft facility linked to their current account
• A majority of students intend to remain with their main bank once they have finished their studies
• Dissatisfaction is greatest in relation to personal contact received with a named bank. manager
• Student holdings of other banking products
• Over a third of students carry a credit card although few have taken out a bank loan
• Few students possess more than two relationships with banks or building societies
• The market for secondary relationships is more fragmented than that for main student accounts
• Student debt
• On average, respondents expect annual income of slightly over £4,000 during 2007
• Around one in five students claim to possess no net non-mortgage debt whatsoever
• The Student Loans Company accounts for an ave. of over 60% of non-mortgage student debt
• On average, students expect to build up almost £10,000 in net debt while they study
• … which suggests that they may be prone to under-estimating the debt that they will accumulate
• More than a quarter of students are unsure how long it will take to repay their accumulated debts
• Students of physical sciences are the least optimistic about paying off their debts in rapid time

3.0 BANK PERFORMANCE

• Introduction
• The satisfaction of students using each of the leading banks can be measured
• … both in overall terms and for eight key aspects of student banking service
• The results for banking performance are as robust as any that have hitherto been published
• Accessibility and opening hours of bank branches
• Breadth and quality of student financial services offered
• Ease of accessing overdraft or credit facilities
• Ease of contact with a student banking manager
• Frequency of contact with a student banking manager
• General conditions offered on student financial services
• Personal contact with a named student banking manager
• Quality of Internet banking service
• Overall satisfaction ratings
• Likelihood of changing main business current account
• Individual bank performance
• Abbey
• Alliance & Leicester
• Bank of Scotland
• Barclays
• Halifax
• HSBC
• Lloyds TSB
• Nationwide
• NatWest
• Royal Bank of Scotland
• Other banks

4.0 STUDENT INSURANCE

• Introduction
• Student contents insurance
• Almost a half of students live in a privately rented flat or house during term
• Over one in four students in the UK claims to be covered by student contents insurance
• Both physical and remote interfaces can be used to promote student contents insurance
• … with use of a variety of direct and intermediary distribution channels also in evidence
• Insured respondents spend an average of over £50.00 on student contents insurance
• … and a majority of uninsured students also suggest that they would be willing to take out cover
• Other types of insurance bought by students
• Well over a third of students are likely to need insurance for a car, moped or motor cycle
• … and many students also own one or more relatively high value mobile or portable items
• … which can be insured in three main ways including stand-alone policies specific to the item
• Three out of ten students in the UK participate in active or contact sports
• … although only a minority of these are covered by any form of sports insurance
• Over a half of students have undertaken significant travel during the last year
• … with most of these having been covered for travel risks during their most recent journey
• Student contents cover makes up only a small proportion of total student spend on insurance
• … with mainstream car insurance taking the lion' s share

GRAPHICS ⁄ TABLES

• Sample breakdown by age group, geographical location and education status
• Sample breakdown by student status, nationality and subject studied
• Student holdings of current accounts in the UK, 2007
• Student holdings of specifically designated student current accounts, 2007
• Bank market shares of current accounts held by students in the UK, 2007
• Importance of criteria used by students when choosing a current account provider, 2007
• Use of overdrafts linked to current accounts by students in the UK, 2007
• Likelihood of continuing with present current acc. provider upon comp. of studies of students in the UK, 2007
• Satisfaction levels with service offered by the bank holding their main current acc. of students in the UK, 2007
• Satisfaction levels with service off. by the bank holding their main current acc. of students in the UK, 2007 (data)
• Student holdings of other banking products in the UK, 2007
• Number of relationships held with banks and building societies by students in the UK, 2007
• Bank market shares of secondary relationships with students in the UK, 2007
• Approximate annual income from sources such as part-time and holiday jobs of students in the UK, 2007
• Current levels of net non-mortgage debt of students in the UK, 2007
• Seg. of non-mort. debt of students between the SLC, banks / bg. socs. and parents or other fam. membs., 2007
• Anticipated levels of net non-mortgage debt upon completion of studies of students in the UK, 2007
• Anticipated time required to pay back non-mort. debt upon completion of studies of students in the UK, 2007
• Ant. time required to pay back non-mort. debt upon comp. of studies of students, 2007 - ave. resp.by subject
• Accessibility and opening hours of bank branches: student evaluation of leading banks, 2007
• Breadth and quality of student financial services offered: student evaluation of leading banks, 2007
• Ease of accessing overdraft or credit facilities: student evaluation of leading banks, 2007
• Ease of contact with a student banking manager: student evaluation of leading banks, 2007
• Frequency of contact with a student banking manager: student evaluation of leading banks, 2007
• General conditions offered on student financial services: student evaluation of leading banks, 2007
• Personal contact with a named student banking manager: student evaluation of leading banks, 2007
• Quality of Internet banking service: student evaluation of leading banks, 2007
• Overall satisfaction ratings: student evaluation of leading banks, 2007
• Likelihood of studs. cont. with main current acc. when they complete studies: stud. eval. of leading banks, 2007
• Overview of performance of Abbey according to student customers, 2007
• Overview of performance of Alliance & Leicestesr according to student customers, 2007
• Overview of performance of Bank of Scotland according to student customers, 2007
• Overview of performance of Barclays according to student customers, 2007
• Overview of performance of Halifax according to student customers, 2007
• Overview of performance of HSBC according to student customers, 2007
• Overview of performance of Lloyds TSB according to student customers, 2007
• Overview of performance of Nationwide according to student customers, 2007
• Overview of performance of NatWest according to student customers, 2007
• Overview of performance of Royal Bank of Scotland according to student customers, 2007
• Overview of performance of other banks according to student customers, 2007
• Type of accommodation in which students reside during term in the UK, 2007
• Student holdings of student contents insurance in the UK, 2007
• Distribution interface used for taking out student contents insurance by students in the UK, 2007
• Distribution channel used for taking out student contents insurance by students in the UK, 2007
• Annual expenditure on student contents insurance by students in the UK, 2007
• Annual expenditure on student contents insurance that uninsured students would be prepared to pay, 2007
• Ownership of cars, motor cycles and mopeds by students in the UK, 2007
• Ownership of bicycles, mobile devices and musical instruments by students in the UK, 2007
• Holdings of insurance for bicycles among students owning bicycles in the UK, 2007
• Holdings of insurance for digital cameras among students owning digital cameras in the UK, 2007
• Holdings of insurance for laptop computers among students owning laptop computers in the UK, 2007
• Holds. of ins. for MP3 players / pers. CD players among studs. owning MP3 / pers. CD players in the UK, 2007
• Holdings of insurance for mobile telephones among students owning mobile telephones in the UK, 2007
• Holds. of ins. for high value, port. music. insts. among studs. own. high value, port. music. insts.in the UK, 2007
• Participation in active or contact sports by students in the UK, 2007
• Holdings of sports insurance by students participating in active or contact sports in the UK, 2007
• Propensity to undertake significant travel during the last year of students in the UK, 2007
• Holdings of travel insurance by UK students undertaking significant travel during the last year, 2007
• Approximate segmentation of annual expenditure by students on all forms of insurance in the UK, 2007
• Approximate segmentation of annual expenditure by students on all forms of insurance, 2007 (data / workings)