In 2017 it seems likely we will see more simple products like AIG’s Key3 Critical Illness product which only covers the three core conditions of heart attack, cancer, stroke at a reduced premium. Already we have been told to expect launch of Royal London’s life insurance product in Q1, which will ask targeted underwriting questions for people with diabetes. On an annual basis, policyholders will be asked to share the results of their blood sugar levels (HbA1c) and if there has been any improvement in their condition, Royal London will look at reducing premiums.
I also expect more use of rewards and benefits packages and a greater focus on technology, whether for underwriting, claims or added benefits. The good news about developments in this area is that it shows companies are focused on growing the market, instead of fighting over a shrinking share, which no doubt will be influenced by any fintech firms that may enter the market this year. More organisations are looking at digital end-to-end processes that will improve efficiency, policy take-up and overall levels of customer satisfaction for those applying for protection policies.
The sales figures for 2016, especially for income protection, an important product to sell alongside a mortgage, were encouraging and hopefully we may be making some headway into changing consumer mindsets about insurance.
According to Gen Re’s November Protection Pulse report, income protection sales increased more than 18% and the number of policies sold grew too, up 3.3% in the first six months of the year compared to 2015. Important quality products like income protection can be sold if advisers are willing to make the extra effort. My hope for 2017 is that insurers will continue to improve at producing positive content and advisers will make the most of this impetus to build on the good work done in 2016.