Battle lines are being drawn in the protection market as new players make aggressive moves into the sector, challenging the current market hierarchy.
Scottish Provident is the current protection market leader with a 30 per cent share. It has been advertising extensively in the press in recent months as its top spot comes under threat from new players, including Scottish Equitable.
ScotEq set up its protection operation in January and says it has had a strong response from IFAs, having issued more than 3,500 marketing packs.
Friends Provident is also looking to expand its protection range in early March.
The area is also still thought to be on Royal London's agenda after it lost to Abbey National in the bidding for ScotProv last year.
ScotEq protection marketing manager Heather Armstrong says: “The response from IFAs shows they welcome another competitor. We are very bullish about our prospects in this marketplace. Increased competition in the market can only be a good thing both for IFAs and customers.”
ScotProv product marketing manager Roger Edwards says: “When ScotProv first focused on protection in 1995, people said it would not be profitable. But we have made it so successful that lots of companies want to get on the bandwagon. We want the whole market to grow. If companies have new ideas to move protection forward, everyone benefits. But if they just want a slice of the existing cake, it does not really help.”
Portfolio Insurance Consultants & Mortgage Brokers principal Brian Lentz says: “It is very healthy that more providers are coming into the market. They need to break the old protection mould and develop new contracts. Protection is important for IFAs to create additional sources of revenue.”