MARKET INSIGHT REPORT 2014 Q1

APRIL 2014

Competitior Analysis

MSM Confused Go Compare CTM Family Insurance Services
Lowest Price £14.50 Payment Care £19.21 Payment Care £19.21 Payment Care £15.25 Realm Protection £15.25 Realm Protection
2nd Lowest Price £15.06 FirstCall Payment £23.00 Sanctury £23.00 Sanctury £18.00 Synergy Financial £18.00 Synergy Financial
3rd Lowest Price £18.00 Synergy Financial N/A N/A £44.04 First Assist £19.38 Mapfre £19.38 Mapfre
Number of Insurers 7 10 4 10 13

Income protection, covering £500 per month for accident, sickness and unemployment with a 30 days wait period for an employed 35 year old male earning £12k per year, living in GL7.

MSM Confused Go Compare CTM Family Insurance Services
Basic Cover N/A £13.32 WPA £13.32 WPA £13.32 WPA £13.32 WPA
Mid-range Cover N/A £55.63 PruHealth £55.63 PruHealth £37.51 General Medical £37.51 General Medical
Fully Comprehensive Cover N/A £59.20 Simply Health £59.20 Simply Health £45.27 April £45.27 April
Number of Insurers N/A 7 7 14 14

Prices based on 35 year old male non-smoker living in GL7.

Key

MSM Confused Go Compare CTM Family Insurance Services
Lowest Price £9.09 L&G £9.16 Beagle Street £8.88 Beagle Street £8.88 Beagle Street £8.89 Aegon
2nd Lowest Price £9.33 Aviva £9.33 Aviva £9.12 Aviva £9.12 Aviva £9.10 L&G
3rd Lowest Price £9.87 Bright Grey £9.42 LV= £9.19 LV= £9.19 LV= £9.25 Zurich
Number of Insurers 13 13 12 11 13

Prices based on 35 year old male non-smoker, living in GL7, covering £150,000 over 20 years.

MSM Confused Go Compare CTM Family Insurance Services
Lowest Price N/A N/A N/A N/A £65.33 PruProtect
2nd Lowest Price N/A N/A N/A N/A £74.01 LV=
3rd Lowest Price N/A N/A N/A N/A £76.40 L&G
Number of Insurers 0 0 0 0 6

Prices based on 35 year old male non-smoker, living in GL7, covering £150,000.

MSM Confused Go Compare CTM Family Insurance Services
Highest Cover Provided N/A N/A N/A £5,859 Shepherds Friendly £5,859 Shepherds Friendly
2nd Hightest Cover Provided N/A N/A N/A £5,573 Ageas £5,573 Ageas
3rd Highest Cover Provided N/A N/A N/A £5,544 Engage Mutual £5,544 Engage Mutual
Number of Insurers 0 0 0 5 5

Price based on 60 year old male living in GL7 choosing a premium of £20 per month.

Life Insurance Confidence At ‘Highest Level’ Since RDR

Since the introduction of the RDR, confidence levels in the Life Insurance sector are at their highest according to the latest CBI/PwC Financial Services Survey: “‘Optimism about business situation’ at nearly 70%”. The report also claims that although operating and marketing costs are at their highest, volumes of sales have grown significantly for the second successive quarter. Headcount has also increased giving a sense of optimism for the industry.

Assured Futures Comment: George Osborne’s latest budget announcing retirees no longer have to purchase annuities will likely have an impact on the Life Insurance market. As annuity sales reduce, attention will shift to protection products. Whilst the annuity market will suffer a significant drop in activity initially, it will recover as retirees recognise annuities secure a guaranteed income throughout retirement.

Life Insurance Non-Disclosure Is Prevalent But Who Is Missing Out?

One in seven claims is paid to a policy holder who has intentionally failed to give relevant medical details. Research by Munich Re has revealed the non-disclosure issue is currently being financially corrected by customers who make honest claims and as a result cover the costs of those who don’t by paying inflated premiums.

Assured Futures’ Head of Life; Richard Harris gives his view.

Key Facts:

Launch Of New Life Insurer Ranking Customer Experience

In order to provide clients with the best possible service Assured Futures has developed a rating system which will feature on our online quote engines. Along with the usual information on premium price, excess information etc. we’ve developed a rating system which will rank insurance providers based on a carefully selected range of variables including: financial strength (Standard & Poor’s rating), claim payment statistics and applications declined as well as our own internal measures of customer service, underwriting approach and ease of application. These variables will then total towards a score out of 10. This will provide clients with an overview of each insurer’s approach to the customer experience.

The score will appear alongside premium price, excess period and other details on each online quote table. It will validate to our customers how well we know the insurance industry and that we’ve become experts in identifying our customers’ needs as well as what they demand for satisfactory and for extraordinary customer service. It also demonstrates our strength and depth of relationships with the insurers themselves – we know their internal procedures and approach towards customers, particularly with applications and claims procedures.

Market Opportunities

Families cut protection payments as raising children hits £277,226

Parents are cancelling or not taking out protection insurance policies in an attempt to cut costs as the expense of raising a family rises to £277,226 per child. According to the annual Cost of a Child report from LV=, rising childcare costs are largely the cause of the increase. This has resulted, according to LV=, in parents becoming less likely to save towards their family’s future: 41% of parents now have no life, critical illness or income protection cover at all. Mark Jones, head of protection at LV= said “If either parent becomes unable to work or is no longer around then this type of insurance can protect you financially at a time when you most need it.”

Assured Futures Comment: This creates an opportunity; approarch families when childcare costs reduce i.e. when children are at school age. Knowing customers' needs, combined with key information on individual families is vital.

Demand to outstrip nhs funding in london by 2020 may lead to greater private medical insurance need

An NHS report warns demand for healthcare in London will exceed funding by 2020 if it continues at its current rate. Radical changes are required and the report’s co-writer Dr Andy Mitchell, England’s regional medical director for London, suggests focusing on prevention and improved primary and community care are the answer as opposed to investing more funding in more hospitals. The report suggests that because the rise in London’s population is faster than any other region; changes in approach to healthcare is required as opposed to more facilities.

Assured Futures’ Head of PMI Richard Kerton shares his thoughts:

Key Facts:

Bite Size News

Contact

Ian Sawyer
Managing Director
Richard Harris
Head of Life Insurance
Richard Kerton
Head of Private Medical Insurance
Ross Hebden
Head of Income Proection Insurance
Ros James
Marketing Manager

Please note the above represents the views of the authors only and do not constitute insurance advice.

For marketing and press enquiries contact Ros James.

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Family Insurance Services is a trading name of Assured Futures Limited.

Assured Futures, Ellenborough House, Wellington Street, Cheltenham, GL50 1AP, 01242 537 082.