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The new protection conversation. How do you tailor yours?

Jennifer Gilchrist, Protection Specialist, Royal London

When it comes to the protection conversation, there’s a new trigger emerging that could help you target a different type of customer.

Some advisers look out for homebuyers, while others look for the pregnant couples. But there’s a new protection trigger in town: our latest State of the Protection Nation report has revealed that 12% of consumers who took out income protection did so as a result of a salary increase. What’s more, consumers tell us that other reasons they took out income protection included starting a business, or a new job, or becoming self-employed. So when you’re looking to grow your protection business, why not talk to customers about their careers first?

Current protection opportunities

And what sort of customers would you think are your biggest opportunity? Interestingly, the advisers we surveyed for the State of the Protection Nation report were most optimistic about the ageing population. But when we asked consumers if they planned to take out protection in the next five years, by far the biggest opportunity was with 18-34 year-olds: 19% plan to take out income protection and 21% are considering critical illness cover, compared to only 2% of consumers aged 55 and over for either product.

So we’ve taken a closer look at a few customer segments to see what makes them tick and understand how you could help them get the right cover in place.

Finding the right protection fit

The first thing people need to understand is their risks. Consumers consider an early death more likely than a serious health condition or being off work on long-term sick leave.

But an average 30-year-old woman is 12 times more likely to be off work for two months than to die during her working life. Perhaps this mismatch between perceptions and reality explains why far more 18-34 year-olds plan to take out life cover (32%) than income protection (19%).

The key to getting the right cover in place – and for the working population that often includes some income protection – is advice tailored to the individual’s circumstances and budget. Consumers tell us they don’t need income protection and that it’s expensive – but they also tell us they don’t understand their risks and the majority of renters said they wouldn’t survive three months without their income. Are their hard-earned savings or emergency credit cards really sitting there to keep a roof over their head for a month or two if they get sick? It’s essential to help support customers’ financial resilience with protection solutions tailored to their circumstances and budget.

We’ve got three easy ways to target customers who might be on the fence about protection:

1. Sales aids aimed at renters, millennials with new jobs, people with debts, self-employed people, part-time workers and more. You can brand your protection sales aids or just use the ready-made Royal London versions: marketing studio/sales aids

2. To help bring the protection need to life, try our case study sales aids: royallondon.com/literature

3. Run a personalised risk summary report for your client and open their eyes to the risks they face in life – then show them options they can afford to cover their biggest risks first marketingstudio/reports

Our State of the Protection Nation 2019 report tracks adviser confidence in the protection market, as well as consumer awareness and perceptions. This is the third year we’ve run the research, commissioning Opinium Research to survey over 2,000 consumers and over 200 advisers.

To see all the findings and learn about consumer segments that might provide great opportunities for you to build your protection business, read our full State of the Protection Nation 2019 report.

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