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Protection push fails over aggregator fears

The Consumer Protection Insurance Engagement Campaign has failed to raise the funding to take its plans forward after providers feared online aggregator sites would attract most new business as a result of a campaign.

A report into the reasons why the 22 insurers and reinsurer failed to back the initiative shows IFA-focused providers feared the campaign would drive more traffic towards online protection sales. In the response paper, seen by Money Marketing, CPIEC chairman and Lifesearch managing director Tom Baigrie says there were three distribution strands related to the campaign – bancassurers, IFAs and others, such as those offering online non-advised sales.

He says: “The clear consensus among those in the advised, but not bancassurer channel, was that online non-advice would be the winner from TV advertising and that IFAs in particular needed a particularly focused approach, which our campaign did not offer.

“There was real concern that unless the message clearly promoted advice, it would do little to overcome the current draw on consumers of aggregator sites like Moneysupermarket.com. Beyond the aggregators, many feared that the big brands and the bancassurers would gain disproportionately.”

Some providers had concerns that a campaign would generate disproportionately more leads to Aviva due to its recent multi-million-pound marketing push.

Baigrie says: “The three strands of distribution are impossible to reconcile into one marketing unit below reinsurer level. A pan-industry campaign will not happen unless the reinsurers take on the burden exclusively.”

However, Baigrie adds: “This lack of belief in the IFA sector’s potential reach, ability and passion was perhaps the most depressing factor and is a key challenge that our industry needs to address.”

Bupa Individual Protection head of product development Steve Casey says: “Tom Baigrie is to be applauded for raising this issue and for the considerable amount of time he has put the campaign. Other industry bodies should take note. Hindsight is a wonderful thing but the key challenge was always going to be the call to contact strategy, given the multi-distributional make up of the sponsoring members. Distribution bias was something I am sure contributed to people’s decision whether to support the campaign or not.”

Pru Protect director of protection development Kevin Carr does not believe the campaign would have given online non-advised propositions an unfair advantage. He says: “It is a great shame the campaign has not taken off. I believe market dynamics would have kicked in and people would have used a range of options as they do already.”

Progress IFA marketing manager Aidan Dewhurst says: “Any attempt to grow the protection market should be applauded. Increasing consumer awareness has an important role because getting people to appreciate the need is half the problem. It is hard to say whether the campaign would have benefited the direct sale more than the advised approach. It would be down to the positioning of the message, the underlying proposition and the call to action. I would be very surprised if that level of detail had yet been decided.”

Munich Re head of marketing Andy Milburn says: “It shows how difficult marketing financial products can be, especially the numbers behind our businesses.”

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