In Depth: Why are people not buying protection?
News from FT Adviser:

We have reached that point in the new year when claims statistics relating to various protection policies are being released by many providers across the sector, with percentages of pay-outs ranging from the mid-eighties to the high nineties.

But quite aside from the annual discussion over claims stats and who does and does not reveal their figures, the protection industry continues to struggle with modest sales.

A recent survey by Ageas found that people were more likely to insure their pets than to have critical illness cover. In the income protection space, the consensus is that sales figures paint a picture of an industry in a parlous state.

But why should this be, given that the majority of people are reliant on their wage to keep up with their bills?

One reason for the low take up of income protection could be the collapse of the mortgage market, according to Will Kentish, head of income protection for Aviva.

“Often when you take out a mortgage, you will take out income protection. About half of income protection sales were with mortgages.

“However, people are not taking out mortgages at the moment… [and] whether the mortgage market will return as it was before is to be debated.”

Ian Smart, head of product development at Bright Grey and Scottish Provident, paints a more downbeat picture, admitting that the marke…………… continues on FT Adviser

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