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Protection Watch: Retirement confusion and cross-industry advertising

Protection Review chief executive Kevin Carr looks at recent market events

Retirement age confusion for income protection
Controversy is growing around the line between income protection policies and changes to the state pension age.

The state pension age is currently 65 for men and gradually increasing for women from 60 to 65.

By October 2020, it will reach 66 for both men and women. The government is planning further increases, which will raise it from 66 to 67 between 2026 and 2028.

Many people have been advised to take income protection policies to tie in with their intended retirement age, but the changes mean that, by the time some reach that age, there could be a gap. It is advisable to contact clients in this regard.

While healthy clients can amend their policy end date if required, those with health conditions or those who might already be claiming could be stuck.

The issue was highlighted in a recent Daily Mail article, which reported “thousands of policies will end before the holders can collect their pensions”. This could be hardest felt by women, with many potentially facing an income gap before they
can receive their pension of five or six years.

Right time for cross-industry advertising campaign?

It does not matter how great your product is; if you do not market it well, it will not sell.

In the world of protection, whenever there are negative stories in the mainstream press – typically a declined claim or, more commonly, people who cannot get cover at all – there will be the inevitable cries of “why don’t they ever write good stories?”, “we pay 97 per cent of claims”, and so on.

There are plenty of good stories out there and paying 97 in 100 claims is great – but it probably does not mean a lot to the other three.

More importantly, it is not the role of the press to do our marketing for us. Even if we paid 99.99 per cent of claims, someone would write about the one we declined, because “plane lands safely” is not news.

We need to do more to promote our products to a wider audience, and that means advertising.

A decade ago, Lifesearch called for a mass market protection advertising campaign, in the region of £5m to £10m, with costs spread across all insurers. The Consumer Protection Insurance Engagement Campaign concept was born and, despite the lengthy working title, it was a great idea. It fell down because of the usual reasons competitors do not like working together: who pays what, who benefits most, what is the return on investment?

But, since then, digital marketing has changed and budgets have become more realistic.

Unlike many other forms of communication, advertising has a degree of control, plus it creates awareness and adds credibility.

CPIEC was a great idea at the wrong time. Perhaps it is time to think again?

Also on the radar…

  • FTRC has launched a new website,, covering protection product analysis, comparisons and policy condition changes. Products such as life, mortgage protection, critical illness, income protection, business protection and relevant life are included.
  • lA new report from Lifesearch aims to get people talking more about difficult financial issues. According to the research, Britons avoid talking to friends, family and colleagues about death, money, sex, religion and politics – in that order. Seventy four per cent of us do not know whether our parents have life cover, while 55 per cent are more likely to discover a loved one’s contingency plans only after they have passed away.
  • lA new divisive and different protection brand has launched in the UK, called Dead Happy. Instead of using the traditional life insurance model, it adopts images of skulls and crosses, and encourages younger people to make “death wishes”. The process is digital (you cannot speak to anyone and there is no advice) and there are only four underwriting questions. The cost of cover over 10 years is typically lower to start with but the price is likely to rise each year. If you want to extend or increase the cover, you need to answer the underwriting questions again.


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