The lack of a set retirement date and a shift to taking on financial commitments later in life means the industry must rethink how it provides cover for older people, Ron Wheatcroft has said.
According to the technical manager at Swiss Re, demographic and social changes mean it is difficult to pinpoint how many people have cover beyond age 65, but the need to ensure protection for later in life is still paramount.
He said: “A set retirement date is now a thing of the past, and the UK government abolished the default retirement age of 65 back in 2011.
“Furthermore, people are taking on financial commitments such as starting a family or purchasing a house later in life. Consequently, we would expect more demand for protection cover extending beyond what were traditional retirement dates. That might well include a revival of fully underwritten whole life policies.”
Moreover, Mr Wheatcroft warned that The Care Act, which came into force in 2014, will place specific responsibilities on individuals to meet some or all of the costs of their own care.
“We welcome products designed to meet some of those costs, either written as an acceleration of or in addition to life cover”, he added.
The 2014 Swiss Re Our Term & Health Watch report showed that guaranteed acceptance whole life insurance to pay the cost of a funeral had consumer appeal, but most products, such as term or endowment plans, were still traditionally written to end at or near the set retirement age.
