Life insurance growth to stall over next five years

clock

Although life insurance regained some momentum during 2012, growth is likely to be stalled by economic issues over the next five years, research has suggested.

A report from data provider Timetric entitled Life Insurance in the UK - Key Trends and Opportunities to 2017, warned continued economic uncertainty is likely to affect the sector long-term. 

It said this is "likely to constrain growth in the category and life insurers will face competition from the banking and wealth management sector offering savings and investment alternatives."

The report also said the value of gross written premiums had declined from £56.5bn in 2007 to £24.2bn in 2012.

Meanwhile, gross written premiums in the UK's life insurance category also fell by 57% between 2007 and 2012.

According to the research, the UK life insurance category is forecast to grow by an average of 3.5% over the next five years.

Despite such adverse factors, this expansion will be underpinned by the country's strengthening economy, aging population and renewed consumer confidence.

Unit-linked investments are expected to dominate the segment. Life insurance penetration represents 1.6% of the country's GDP, and has remained significantly below its pre-crisis levels. Life insurance density also fell sharply,totalling a value of £384.1bn in 2012.

In addition, the role of low-cost channels in securing new business will grow significantly over the forecast period, with e-commerce and direct marketing expected to further dominate the distribution of guaranteed acceptance plans, the report concluded.

 

More on Whole of Life

How lifetime gifts can undermine taper relief and estate planning

How lifetime gifts can undermine taper relief and estate planning

The hidden IHT trap

Tony Müdd and Charlotte Toogood
clock 25 June 2025 • 5 min read
The race for life: scale vs margin

The race for life: scale vs margin

Protection needs its ‘Monzo moment’

Alain Desmier
clock 28 February 2025 • 4 min read
How to resuscitate the life market

How to resuscitate the life market

Focus on customer outcomes

Rory Yates
clock 19 November 2024 • 4 min read

Highlights

COVER Survey: Advisers damning of protection insurer service levels

COVER Survey: Advisers damning of protection insurer service levels

"It takes longer than ever to get underwriting terms"

John Brazier
clock 12 October 2023 • 5 min read
Online reviews trump price for young people selecting life and health cover

Online reviews trump price for young people selecting life and health cover

According to latest ReMark report

John Brazier
clock 11 October 2023 • 2 min read
ABI members with staff neurodiversity policy nearly doubles

ABI members with staff neurodiversity policy nearly doubles

Women within executive teams have grown to 32%

Jaskeet Briah
clock 10 October 2023 • 3 min read