View more on these topics

Datamonitor sees CI fall and tells IFAs to explore new avenues

Datamonitor has warned IFAs of a slump in criticalillness sales, saying it expects only a 20 per cent growth from the current £330m to £389m by 2008.

The analyst does not believe there will be a market crash but advises IFAs to seek other sources of revenue if their business streams are heavily reliant on CI.

In a report published this week, entitled, UK Critical Illness 2004 Report, Datamonitor predicts that with an expected stockmarket recovery by 2005, there will be renewed confidence in the savings market, leaving consumers less likely to take out protection products.

The report says new CI business grew by just 10 per cent in 2003 compared with 30 per cent in 2002. It shows scepticism towards new-generation products, finding little evidence of moves towards them. It also warns against altering the simplicity of CII sales processes.

The industry has come under increasing pressure as claims have soared, medical science has advanced and survival rates have increased. These events and the withdrawal of some reinsurers from the market are cited by the report as contributing factors towards the average 30 per cent premium increases in 2003.

The report&#39s author Janette Weir says: “At present, the sales process is very easy. If the disease happens, a lump sum is paid. Measures such as altering the definition of the conditions while the policy is in force are fraught with difficulties in interpretation and could lead to the next misselling scandal.”

Recommended

Bupa plans simple route to success

BUPA BUPA DENTAL PLAN Type: Group healthcare cash plan for dental cover Minimum premium: Dependent on group size and age of employees Minimum group size: Three Minimum-maximum ages: 18-no maximum Cover provided: Up to two examinations a year, up to two scale & polish treatments a year, x-rays, fillings & root canal treatment, extractions, crowns, […]

Regulation &#39most sensible way forward&#39 says ABI

The ABI has welcomed the Treasury&#39s decision to regulate home reversion schemes, calling it the &#39most sensible way forward&#39. The trade body, like many industry groups, has lobbied the Treasury extensively to change its mind and introduce legislation to regulate home reversion. Until now, the Treasury has resisted, saying there has been no evidence of […]

&#39Liabilities of ex-IFA networks&#39

Mortgage firms looking for a principal firm should steer clear of IFA organisations, mortgage and general insurance network Network Data has warned. Speaking at the Money Marketing Live event, Network Data managing director Richard Griffiths issued a stark warning to firms still deliberating over which mortgage network to join. He thinks firms should be cautious […]

Howard calls for Blair intervention on pensions compensation

Leader of the opposition Michael Howard has waded into the increasingly heated row over compensation for the 60,000 pensioners whose funds have been wound-up. He is calling for the Prime minister to make a personal intervention.

Frexit & contagion risk in Europe

Many commentators have suggested the UK’s exit from the European Union will trigger a domino effect, leading to its eventual break-up. Neptune Head of European Equities Rob Burnett discusses the likelihood of this happening. Click here to read more Important informationInvestment risks Neptune funds may have a high historic volatility rating and past performance is […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment