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Protection market review December 2016

Part 2

Protection market update for December 2016, Part 2

Macro news and drivers

£10m a day paid out on protection policies
UK insurers paid out the equivalent of £131 million to customers every day under general insurance, long-term savings and pension policies according to the definitive industry statistics published by the Association of British Insurers (ABI).   
Benefit strategy rethink needed following Autumn Statement changes
Almost three-quarters (71%) of delegates polled at Aon Employee Benefits' recent salary sacrifice seminar felt they would have to rethink benefit strategy as a result of the changes to salary sacrifice announced in the Autumn Statement.   
IFAS call on insurers to provide annual statement
Consumers should receive annual statements reminding them of their insurance cover, similar to those received for pensions and investments, according to the Protection Distributors Group.   

Regulation and legislation

Lib Dem leader challenges IPT rise
Liberal Democrat leader Tim Farron has urged the government to reconsider rising insurance premium tax (IPT) to 12%. Farron, who is also the MP for Westmorland and Lonsdale, submitted an Early Day Motion for MPs to debate this matter in parliament.   
FCA finalises guidance for fair-treatment of closed-book policyholders
In Finalised guidance 16/8: Fair treatment of long-standing customers in the life insurance sector, the FCA wanted to ensure that customers with life insurance products, such as whole of life policies that are closed to new business, do not receive less attention than customers who have recently taken out a new product.  
EU disclosure rules will hit insurance brokers
European requirements on insurance brokers to disclose remuneration fully to clients could put additional pressure on advisers, experts have warned.   

Product developments and innovation

Royal London launches digital trust service
Royal London has launched an online trust service in the latest enhancement to its protection proposition. The online trust service hosts a range of the most popular trust forms that advisers would require when placing a life policy in trust, including a Relevant Life Trust and a Business Trust. The insurer is also planning to add more trust forms in the future.   
LifeQuote: communication gap
LifeQuote will support advisers whose clients do not have an email address as an increasing number of life insurers insist on email addresses on the application. Of the 11 insurers surveyed, six require customers to have an email address in order to set up an account.  As life insurers update their online systems this number is expected to rise.   
Zurich to introduce e-signatures and electronic GP reports
Zurich is rolling out e-signature approval for the AMRA (Access to medical records act) declaration and will soon be starting a pilot of electronic GP reports on individual protection policies.   
Legal & General partners with digital healthcare service
Legal & General has partnered with digital healthcare service Doctor Care Anywhere to offer virtual access to general practitioners. The insurer is piloting this service with its existing group income protection customers, giving insured employees access to video and phone consultations with general practitioners through their computer, tablet or smartphone.   
The Exeter launches protection platform using TCP's 'SS/G Digital' solution
Implemented in under 10 months, 'SS/G Digital' deploys new Customer and Adviser portals allowing The Exeter's customers and their advisers to place, track and alter their cover with The Exeter online.    
Scottish Widows to use electronic GP reports
Scottish Widows has introduced electronic General Practitioner (GP) reports into its protection policy underwriting process. The aim is to make it simpler and quicker to obtain customers' medical information from their GP practice.     
Canada Life chooses AXA PPP
Canada Life Group Insurance has chosen AXA PPP healthcare to provide employee support services to its 2.7m insured employees in 23,500 employer-funded schemes.      

Consumer trends

More than 13 million UK women lack a financial safety net
For nearly three in ten (28%) women in the UK, the inability to support themselves or their families financially is their greatest financial fear, according to research. The report from Aegon found that nearly half (46%) of 2,000 women polled believe it's solely their responsibility to make sure that their family has enough income should the unexpected happen.   
1 in 7 are absent from work for four weeks or more
Some 1 in 7 employees had been absent for four weeks or more in the previous 12 months, according to research from Ellipse. This suggests that four week long absences are more common than the 1 in 18 risk reported by UK government earlier this month. Ellipse had surveyed 1,005 UK SME employees.   
Two thirds of stay at home mums don't have life insurance
The financial risk to a family of the death of a stay-at-home mother has been put at £29,812 a year by SunLife. The insurer has highlighted that only one third of stay at home mothers are covered by such insurance.   

Experts corner

Protection market needs to adapt to fit retirement trends
Paul Roberts discusses what changing retirement trends will mean for the protection market.

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