UK Protection Insurance 2024: Income Protection
Summary
The report provides an in-depth assessment of the income protection insurance market, looking at current and historical market size with regards to changes in contracts and premiums. It examines how income protection products are distributed and highlights key changes in the competitive landscape, as well as the proposition of the key market players. It provides five-year forecasts of contracts and premiums to 2028 and discusses how the market, distribution, and products offered are likely to change in the future, as well as the reasons for these changes.In 2023, the income protection market experienced significant growth, with both contracts and premiums increasing. The product experienced high demand amid challenging economic conditions, particularly the cost-of-living crisis. The advised channel is favored for the purchase of income protection products, with intermediary firms dominating the market. Consumers actively seek advice to better understand their insurance needs and find the most cost-effective option.
Scope
- Aviva took the lead in the income protection market, overtaking Legal & General.
- 36.1% of respondents indicated that mortgage protection was the most important feature of income protection products.
- 18% of fully employed individuals have income protection in place, whereas only 11.8% of self-employed individuals have the same coverage.
- Examine the size of the standalone income protection insurance market
- Identify the leading providers of income protection insurance
- Learn about the implications of the cost-of-living crisis on the market
- Understand the influence of a variety of factors on market growth
- Executive summary
- Background: The Protection Market
- Contracts in the protection market declined for a second year
- Income protection grew both contracts and premiums
- The advised channel leads the protection market
- The Income Protection Market
- The IP market grew for the third year in a row
- The majority of consumers seek advice when purchasing IP
- Market Drivers
- Financial wellbeing is closely linked to mental health
- High interest rates put further pressure on consumers
- Accident cover and sickness and comprehensive cover dominate the IP market
- Consumers are becoming more aware of IP due to the cost-of-living crisis
- The main policy features consumers look for are mortgage and salary protection
- AI chatbots can be leveraged to provide a seamless consumer experience
- Many businesses are yet to start with the first Consumer Duty board report
- Product Launches and Innovation
- The Exeter adds new features to its income protection product
- Insurtech Eleos is set to expand its life insurance offering after securing funding
- Other partnerships and innovations
- Competitive Landscape
- In 2023, Aviva overtook L&G to lead the IP market
- Table IP market share by number of new contracts/lives insured, 2023
- Company Profile: Aviva
- Company Profile: Legal & General
- Company Profile: LV
- In 2023, Aviva overtook L&G to lead the IP market
- Forecasts
- The IP market is set to reach GBP130.1 million in premiums in 2028
- Growth is expected across the entire forecast period for contracts and premiums
- Both homeowners with mortgages and renters do not have adequate protection
- Underinsurance persists as consumers do not consider adjusting cover after life events
- Insurers have opportunities in the self-employed and gig economy sectors
- Appendix
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