Protection market grows by 4.1% - Swiss Re

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The protection market has seen widespread growth, increasing by 4.1%, Swiss Re's Term & Health Watch 2015 report has found.

The report, looking at figures across the industry for 2014, found that 1,667,818 new term assurance, whole life, critical illness and income protection policies were sold.

Some categories of products saw larger increases, with new non-linked whole of life policies seeing growth of 13.8% while new guaranteed acceptance whole of life policies fell by 1.2%.

Term life cover only and term life with critical illness cover both saw increases the former by 5% and the latter by 5.6%, while across all critical illness categories the increase was 4.4%.

In 2014, 1,667,818 new term assurance, whole life, critical illness and income protection policies were sold, an increase of 4.1%.

The report said: "In many ways, the 2014 results come as a pleasant surprise. Against a background of some firms withdrawing from providing advice and with consumer confidence remaining quite fragile, it would have been no surprise to be reporting a further decline, continuing the trend seen in the 2013 data."

The report warned that: "While the reported increase in new sales is very welcome, there is little yet to suggest the step change needed to bring cover across the UK to a more realistic level despite the best intentions of many very good people to drive that change."

The decline in sales through third parties such as advisers which was reported in 2013 has been reversed though the figure remains below 2012's figure.

The report's survey of the views of those in the industry found that: "Overwhelmingly, respondents were very positive about the 7 Families initiative being an effective way of demonstrating to potential customers the potential value that protecting income can bring."

The top provider for term and critical illness policies was Legal & General, in both markets Aviva and Friends Life held second and third places, with Lloyds Banking Group (LBG) fourth.

AIG took the fifth spot for term sales while Vitality took it for Critical Illness policies.

For new whole of life sales the largest provider was Sun Life direct, followed by Aviva, Legal & General (L&G), LV= with Vitality in fifth place.

Friends Life was the largest provider in the income protection market followed by LV=, L&G, LBG and Exeter Family Friendly.

Further Reading:

Protection Pulse: How 2014 ended without a bang

Has critical illness reached critical mass?

Group risk covers 1.25m more people - Swiss Re report

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