Friends Provident today has announced a deal with retail giant Tesco, to distribute protection produ...
Friends Provident today has announced a deal with retail giant Tesco, to distribute protection products direct to the consumer (D2C).
The 'in principle' agreement may see products including life insurance and income protection (IP) made available without financial advice before the end of the year.
It follows a growing trend of providers utilising the big-brand power of supermarkets to reach the mass market. Existing D2C distribution arrangements include life insurance deals between LV= and Boots, and Legal & General and Sainsbury's.
Previous moves caused consternation amongst advisers as retailers were discounting commission from product prices in a bid to entice customers. Last month, Peter Le Beau, co-chair of the IP Task Force, said that providers "will probably need to go direct" if they want to reach the mass market.
Simon Clamp, Friends Provident managing director, UK, says it is "absolutely delighted" with the Tesco deal. "Tesco were looking at the market and they chose us," he says. "We're really pleased." The arrangement will bring Tesco's current deal with Direct Line to an end.
Friends Provident also announced individual protection sales in Q1 2009 fell by £800k to £9.1m from the same period last year. Group protection sales doubled to £2m in the same period. Elsewhere, it said sales of life and pensions products fell 40% over the past year.
