Income protection becoming more popular

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Income protection becoming more popular
Credit: Hollie Adams/Bloomberg

LifeSearch has seen a rise in income protection claims, while others have seen sales go up.

Data from the life insurance broker shows income protection claims accounted for a third (33 per cent) of claims between January and November 2020.

The figure marks an 11 percentage point increase on the previous year, when income protection claims made up 22 per cent of the total between January and November 2019.

Emma Walker, chief marketing officer at LifeSearch, said: “It’s becoming clear that Covid-19 and its consequences are leading to an increase in protection claims across the industry.

“In the hierarchy of protection products, income protection is perhaps the most important as it supports people when they are out of work due to illness or injury. 

“Paying claims is the first and most crucial job of an insurer, so we’re delighted to see so many income protection claims being paid to help provide a vital safety net for people during these challenging times.”

Meanwhile Mark Jones, product director of retail protection at Legal & General, reported an increase in income protection sales.

Mr Jones commented: “Our IP sales are up this year overall, and up by 9.5 per cent year-on-year, Q3 to Q3.

“While it’s not possible to be specific about the exact reasons, it is likely that the pandemic has driven increased interest from both advisers and consumers this year.”

Likewise Vikki Jefferies, proposition director at Primis Mortgage Network, said the pandemic had highlighted the importance of income protection.

She commented: “We have seen instances where advisers are seeing greater engagement from customers when they introduce the topic of protection, with clients asking more questions about how products like income insurance can support them.”

But Ms Jefferies said while the shift in attitudes was encouraging, there was still “some way to go”.

According to research for the Association of Mortgage Intermediaries (AMI) in September, fewer than one in 10 adults (7 per cent) had income protection in place.

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