UK life protection market for regular, individual premiums has entered a quiet period, with a new normal level of business of reduced contracts and premiums since 2013. With the protection market fairly stable in terms of premiums, the real story lies in changes in distribution. The non-advised channel is starting to gain momentum for term products that can be easily commoditized. Term distribution is expected to move away from independent financial advisors (IFAs) and begin to mirror the general insurance market, where policies are sold directly and through aggregators.

Over 50s whole of life policies are already sold without advice. Robo-advice and technology will be increasingly used to bridge the advice gap for less affluent customers following the Retail Distribution Review (RDR), in addition to streamlining the customer journey to make it easier to purchase protection products. Providers’ propositions are also changing. Policies are becoming more personalized to individual risk by using big data from wearables, with insurers developing policies for specific risk groups. Providers are also trying to actively help their customers manage their health by investing in diagnostic healthcare technology, launching wellbeing apps, and providing customers with virtual GP services.

Key Finding include in this report –

• Total protection premiums reached £672.5m in 2016, exhibiting growth of 2.0% for the year. Term premiums reached £476.3m following 2.0% year-on-year growth to 2016, whereas whole of life premiums shrank by 13.6% to £98.1m.
• The protection market is dominated by a few key players. Legal & General holds the largest share of the term market (32.6%), whereas SunLife holds the largest proportion of the whole of life market (39.1%).

Critical success factors –

• Direct distribution: Customers are more confident making their own decisions and self-serving. Providers should ensure they provide the capacity for customers to purchase cover directly and through aggregators.
• Robo-advice- Providers should offer solutions that help identify the advice products most suited to them. This is important to bridge the advice gap for less affluent individuals and those going direct.
• Customer-centric products: Providers must move away from being protectors and begin to actively help customers manage their health and risk. Reframing products to talk about protection more positively and away from the point of death is an opportunity to increase penetration.

The report “UK Protection Insurance 2017: Term and Whole of Life” covers the market for individual regular premiums, concentrating on the main market for all types of consumers seeking their own cover. Taking protection as a whole, it focuses on the major and closely related product lines of term and whole of life insurance that broadly provide financial compensation in the risk-measured event of death or severe health issues.

Moreover, this report provides the following –

• Examines the size of the protection market over time, and how the distribution landscape is changing and being impacted by technology and direct propositions.
• Provides the top market players and their propositions.
• Forecasts how the size of the market will change over the next five years, discusses consumer engagement with protection products, and highlights how providers’ propositions are likely to change in the future.

Companies mentioned in this report: Legal & General, SunLife, Scottish Friendly, Aviva, Royal London, Zurich, Vitality, Virgin Money, Post Office.

Scope

• The protection market is dominated by a few key players. Legal & General holds the largest share of the term market, whereas SunLife holds the largest proportion of the whole of life market.
• Providers are trying to actively help their customers manage their health by investing in diagnostic healthcare technology, launching wellbeing apps, and providing customers with virtual GP services.
• Following the Retail Distribution Review, robo-advice and technology will help bridge the advice gap for less affluent consumers.

Reasons to buy

• Understand how customers perceive protection products and what can be done to make them more attractive.
• Remain competitive by discovering how providers are changing their propositions.
• Discover how technology and robo-advice are being used to simplify the distribution of protection products.
• See how the UK protection market is forecast to grow over the next five years.