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The Financial Conduct Authority is concerned over how protection insurance products are sold to consumers.
The products in question include income protection, critical illness and life insurance. They are designed to help individuals and their families with their finances should the policyholder die or become unable to meet their financial commitments. And they have been increasing in popularity.
The latest figures from the Association of British Insurers (ABI) show sales of income protection to individuals (rather than through the workplace) were at a record high in 2023, hitting 247,000, a 16 per cent increase on 2022 and the highest level since the ABI started collecting the data in 2000. Plus, standalone critical illness sales were almost four times higher than 10 years ago.
However, the regulator worries that some products may be poor value. It is also concerned that commissions paid to intermediaries may not deliver good outcomes to policyholders. It intends to launch a market study later this tax year.
We want to hear your experiences regarding protection insurance. Has a policy been a comfort to your family? Or do you regret it? Do you worry you have the wrong type of insurance? Or that you may be over-insured?
Please email moiraonmoney@gmail.com with your views, or to share your experience.
