No signs of moving forward leaves Forum delegates impatient
Critical illness (CI) providers have to stop waiting for their competitors to make the first move and be more proactive with product development if we are to see a new generation of products hit the market any time soon.
Speaking at a question and answer session at the COVER Protection Forum, Richard Walsh, head of health at the Association of British Insurers (ABI), said a new strand of hybrid products that incorporate CI cover would be welcomed by the ABI. But according to Walsh, no providers are currently being brave enough to test the water.
"If there is feeling in the industry that a new product is needed that is clearly differentiated from current critical illness - such as a hybrid income protection/ critical illness product, the ABI would have no problem with it. But one of the insurers will have to stick their head out if we are to see these new products emerge," said Walsh.
With most of the market agreeing that current product models are unsustainable - especially with an affordable guaranteed rate - new ideas for product design have been widely called for over the past year. However, delegates at the Forum appeared impatient that no positive moves had yet been made.
When one delegate asked if providers were currently working together to find new solutions, Alun Beynon, head of sales at Scottish Equitable Protect, said insurers were unwilling to share their ideas.
"I would love to say that the top seven providers will agree to a new product template. However, the com- mercial realities of life lead us to say that is not the case," he said.
Nick Kirwan, current chairman of the ABI's CI working party and head of marketing and product devel- opment at Scottish Provident, said providers were divided over which way the market should head. "There are two camps at the moment. Those that believe guaranteed rates are not a priceable risk and those that think it is," he said.
