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Critical business is booming

Despite the turbulence caused by product providers withdrawing guarantees and raising premiums, individual critical-illness insurance sales had a bumper 2002, growing by 34 per cent, according to Swiss Re&#39s term & health watch report.

The benchmark analysis of the life and protection market for the last 12 months reveals that, as well as the boost in the CI market, individual term sales rose by 31 per cent while individual income protection sales were up by 20 per cent.

The CI market increased to 1.2 million policies, up from 872,000 in 2001. The term market saw 2.1 million new policy sales compared with 1.6 million the previous year, while individual income protection sales reached 245,000 from 204,000.

IFAs accounted for 49 per cent of CI sales, 44 per cent of term sales and 47 per cent of individual IP policies sold in 2002.

Top of the league table for CI sales was Norwich Union with 225,000 sales, Legal & General is in second place with 185,000 sales, Scottish Provident is third with a total of 135,000, followed by HSBC in fourth with 83,000 and Scottish Widows at fifth with 76,000.

The top five represented 60.4 per cent of sales.

Swiss RE life & health head of sales and marketing Mark Johnson says: “We have a dynamic and competitive market for long-term protection business with new sales at record levels. Intermediaries are clearly responding positively to difficult investment conditions by addressing consumers&#39 most fundamental needs.”

Norwich Union director of product development Willie Mowatt says: “Norwich Union is delighted to have topped the league table for critical-illness cover sales. It is encouraging to see that more and more consumers are now making sure their most precious asset – their family – is properly protected.”

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