Although it is far too early to tell whether the protection market grew in 2015, it felt to me like a vintage year. On the retail side, Insurance Conduct of Business Sourcebook regulatory activity was minimal, which may explain why there was so much excellent innovation in the sector.
A host of new insurers came, or returned, to market with positive plans to be different and better. Some concentrated on the direct-to-consumer route to market (which Sun Life has made work well for years with its simple over-50s product and its free Parker pen pitch), while others focused on the advice sector. Royal London concentrated on both areas at the same time, merging its two old brands to boot. Some serious management effort applied there.
New players showed forward thinking, signing up with UnderwriteMe’s tool, which also provides intermediaries with the on-the-spot underwriting engine. This year, at least two of the biggest term life offices will be using it to allow us to protect families there and then, which should see it reach critical mass. I really do expect it to transform our industry in favour of our customers.
Of course, the whole year was played out against a backdrop of sports stars and dachsunds in the press and on TV. Vitality’s advertising campaign made protection fun by promoting healthy living and an outstanding loyalty scheme.
It has become a global success because it has spotted the fact that getting your clients fitter means claims will be fewer, and if you can help them afford fun things then they will remain extra-loyal. Its boldness and focus on being different and better rather than cheaper means no insurer deserves to succeed more than Vitality.
And then there has been the Seven Families campaign, which gave the industry its first taste of what joined up co-operative marketing looks like. With regards to publicity its small budget has been a huge success in terms of value for money and my expectation is income protection sales will have grown considerably.
At more than 100 policies a week, my firm is writing more income protection than ever. If we could just find consumers who had ever heard of it we could add a nought to that number in no time. I must ask, however, bearing in mind income protection takes intermediaries a lot more effort to get on risk, why does it earn us so much less?
Looking forward, we hope for another benign year from the regulator (which seems to have accepted the greatest scandal in protection is that consumers do not have enough of it) and greater effort from the big general insurance and banking brands.
All will focus on simple online journeys. However, the wise will support these with human interventions as consumers will not yet be ready to go it alone to do what they know they ought to but do not much want to.
Tom Baigrie is chief executive of LifeSearch