Insurers should follow the example of the South African market and develop products for those on low incomes, says Munich Re head of marketing and propositions Andy Milburn.
He recently returned from a research trip in South Africa and found that providers are designing specific products for low-income communities such as people living in townships. He said: “Providers there are designing products for people who do not have much money but here we do not do this.”
Milburn said providers believe highnet-worth products can be adapted for the lower-net-worth market but he said the market needs to offer much more innovation for these customers. He said there is an inherent “snobbishness” in the protection industry over products such as credit cover and funeral cover.
He said: “If someone who lives in a council house who is just about managing day to day buys a funeral plan when they have no other cover, is that not a good thing? I think it is. Other countries think it is. But for some reason, a lot of people in this room seem to think that that it is beneath us. I wonder why.”