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.”