It has been well documented that protection products, such as critical illness cover and income protection, are undersold – partly because they are not always well understood by advisers in the first place.
Clients also remain hesitant to buy protection, citing cost as a primary reason, as well as a belief that they simply will never make use of the cover it provides.
But the Covid-19 pandemic has thrown the need for protection into sharp focus.
Ian Teague, UK managing director at insurance software provider iPipeline, says people are more aware of protection than ever before.
“From a business perspective, we saw a spike in protection – particularly income protection – sales in mid-March as people reflected on their needs and as advisers had more conversations,” he explains.
“But it’s important that we continue those discussions to ensure that protection receives ongoing air time and attention.”
At the same time, the usual channels for protection sales are diminishing, including the mortgage application process and time with clients face-to-face. Mr Teague adds that fewer mortgages are being taken out as a result of a decline in house purchases during the lockdown in the UK.
iPipeline’s software automates this process at every stage, including lead generation, sales, underwriting and post-sale support. The company has been working hard with the mortgage market to improve the uptake of protection policies, which paid off last year.
“From an advice point of view, during 2019 we focused on underserved markets.
“Firstly, mortgage brokers, which saw an increase in protection cases through our services – in particular, income protection increasing 54 per cent in 2019,” Mr Teague says.
He explains that iPipeline recognises that advisers, the broker community and protection specialists face challenges such as increasingly complex products, in addition to searching for and documenting solutions for clients.
“It’s time consuming, people don’t necessarily have the skills, there are more intricate life events and the traditional gateways to protection have been occurring later in life.
“We focused on working in partnership with distributors, providers, and other partners in the marketplace in understanding what prevents advisers from delivering effective protection advice, making sales easier and better serving their client needs.”
By spending time listening to what the challenges are, he says iPipeline is then able to work with advisers and brokers to solve those issues with an innovative, technology-backed solution.
“We work in an industry that historically had a lot of paper, a lot of manual processes, and technology creates the ability to streamline processes, supporting advisers and consumers in the digital age,” Mr Teague notes, adding that this is even more important in the “lockdown world”.
He predicts that as the UK emerges from the lockdown – whenever that might be – more consumers will be “digitally familiar” and be more willing to purchase and engage in a digital environment.