"The general perception of protection has increased significantly due to the pandemic"
2020 has been a very unusual year. A global pandemic has drastically changed our day-to-day lives and - in many ways - our industry. To look back at how the past twelve months has affected how we do business, Financial Reporter will be sharing a series of Year in Review pieces covering different sectors of financial services. Experts from across the industry will share their thoughts on 2020 and how we can look forward to 2021 - here, taking a look at the protection market.
Here's what some of the biggest names in protection had to say about this year and how the market will continue to change in 2021:
Vikki Jefferies, proposition director at PRIMIS Mortgage Network, said:
“Adapting to homeworking and an uptick in customer demand has been no mean feat for the protection market. Insurers have worked tirelessly to adapt and update their policies in order to support borrowers who have taken a hit during the pandemic, from offering rebates to customers facing delayed treatment to bringing in payment and premium holidays. Advisers have also helped hugely in this area, ensuring that clients have a financial safety net in place should the worst happen. This support from insurers and brokers has been invaluable to thousands of households across the UK and will continue to be essential as the crisis endures.”
Daniel Payne, managing director of Fluent Mortgages:
“The general perception of protection has increased significantly due to the pandemic. It has given customers a real-life experience. Covid-19 has affected everyone in one way or another and for some the loss of a loved one or an impact on their household income.
“Covid-19 is indiscriminate and anyone can be affected. Before the pandemic there was already a huge insurance gap with many households not seeing life, critical illness or income protection as a priority. For some this will be driven by cost but for others it has been based on the misconceptions of what protection products are for and how they can protect individuals and households against a significant detrimental risk. The general public are more aware of their vulnerability than ever before and whilst for some it’s too late others want to ensure they and their loved ones have some financial fallback should the worst happen.”
James Holden, marketing manager at Protectline:
"As one of the UK’s largest life insurance brokers, Protect Line has seen a huge shift in consumer behaviour in 2020 compared to previous years. Both during and since the national lockdown in March the company has seen a 25% increase in lead conversion and a 20% decrease of customers cancelling their policies. Whilst correlation does not always imply causation, the results have remained constant and not like anything the company has experienced since it started in 2010. It is believed that the prevalence of Covid-19 has made the British public much more aware of their mortality and highlighted just how fragile most household income actually is."
"Tackling misconceptions has been one of the biggest challenges of the year, with frequent comments from the public about insurers not paying out or that Covid-19 isn’t covered under policies. With so much fragmented information online the opportunity for brokers in 2021 is in educating the public about protection, as opposed to a purely lead generation focus."
Lisa Martin, development director at TMA Club:
“The protection market has responded incredibly well to the challenges presented by the Covid-19 crisis, not only by managing a significant surge in demand, but also by successfully addressing customers’ evolving needs. Trade bodies including the Association of Mortgage Intermediaries (AMI) in conjunction with two significant life offices have conducted some significant research to benchmark market sentiment, allowing all stakeholders to consider a roadmap plan for improvements in this hugely important sector. This is a fabulous first step, which highlights that collectively as an industry we need to work together, to improve education, ensure customers clearly understand and feel the value of protection, and that we address the less favourable myths linked to the sales process of the protection suite of products.