Research commissioned by Royal London indicates financial advisers have confidence in the protection insurance market and they predict a stable market outlook for this year.
The results of the first Royal London Adviser State of the Protection Nation research reveal that the majority of advisers who currently sell life insurance, critical illness cover and income protection predict they will continue to do so over the next 12 months.
This follows a stable picture in 2016 in which six in ten said they had sold a similar amount of life insurance and critical illness cover in the last 12 months, compared to the previous year and half saying they had sold a similar amount of income protection.
Even against the challenging backdrop of the current economic climate, Royal London said one in four advisers are optimistic, expecting to see a rise in sales of life insurance over the next 12 months with a similar number hopeful about future opportunities in general.
There are a few advisers who are less optimistic; however, with 1 in 10 predicting that they will make fewer income protection sales this year.
This is echoed by the finding that one in four of those surveyed had found it harder to sell income protection and critical illness cover over the last 12 months, indicating that there are consumers who are less convinced about the benefits of income protection and critical illness cover.
Whilst the commonly held view amongst advisers is that protection insurance products provide a real and genuine solution to consumer needs, the survey shows they face challenges in selling that message to consumers.
Debbie Kennedy, group head of protection strategy at Royal London commented: “The results highlight there is work we need to do to help advisers break down the barriers that consumers have to buying protection. As people are more likely to claim on an income protection policy than die during their working life this type of insurance should be a priority.”
Royal London plans to run the research annually to develop an adviser confidence index that will track adviser views on the protection market and sales predictions for the following 12 months.
The starting score for the Index is 60.75 out of a possible 100.
Debbie Kennedy continued: “I’m pleased to see that the first State of the Protection Nation Adviser Confidence Index has started at a healthy level. I hope that this will continue. Despite advisers saying that sales of some protection products are proving difficult, providers are looking at ways to use data and technology to grow the market and I hope our efforts will translate into an increase in sales over the year.”
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