View more on these topics

Advisers warn poor protection sales are set to continue

Protection advisers warn the poor protection sales figures for the first half of the year look set to continue. 

A combination of more expensive premiums as a result of the gender directive – which at the end of last year banned providers from charging different premiums for men and women – and a fall in adviser numbers as a result of the retail distribution review will lead to a smaller market, they warn. 

In the past month, a number of insurers have reported a dip in new protection business for the first half of the year. 

Ageas reported a 7.4 per cent drop in new annual premiums from £17.1m in the first six months of 2012 to £15.8m in the first half of this year, while Royal London, which includes the brands Scottish Provident, Scottish Life and Bright Grey, reported a 6 per cent fall in protection business from £35m to £33m.

Legal & General reported a 10 per cent drop, from £72m to £65m, while LV= reported a 9 per cent fall from £16.1m to £14.7m.

Zurich and Friends Life did not include a breakdown of protection sales in their first half results.

Highclere Financial Services partner Alan Lakey says: “Any adviser with half a brain did a lot of business last year to beat the gender deadline. The potential for rebroking has been minimised because of gender because of the premium increases.”

Axxis Financial Planning director Owen Wintersgill says: “I think the situation will only get worse because there is not enough people selling protection.”

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. When I first came into this business over 30 years ago I sold a lot more protection as I was younger and so was my client base. I’m now in my 60s and so most of my clients so I tend to sell investments.

    As very little young blood is coming into the business it’s easy to see why protection sales are dropping. It is quicker to train to be an astronaut than it is to train to be a IFA.

    Is all down to regulation gone mad!

  2. Whilst new business figures might be down, some consideration should be given to the overall lapse rate of existing business and how this is performing. Based upon the opportunity for re-broking business now being limited, this should mean that insurers are finding a reduction in lapse rate, thus a more profitable book of business should it not? So whilst new business figures are down I wouldn’t have thought the insurers are overly worried….

  3. You forgot to mention the issues affecting clients thinking , when they constantly read stories in the mainstream press (Daily mail etc.), highlighting those very few cases where insurers fail to pay out , some of which are spurious to say the least and some are downright fraud . No mention is ever made of the £hundreds of millions paid out each year that help prevent families going under when death or CI strikes unexpectedly !

Leave a comment

Close

Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm

Email: customerservices@moneymarketing.com