The Association of Mortgage Intermediaries (AMI) has launched its fifth Protection Viewpoint Report – Making Protection Personal – in partnership with Royal London and Legal & General.
The report emphasises the need for a stronger customer focus, addressing individual needs and aspirations. To help achieve this, AMI has also unveiled a four-point action plan aimed at supporting advisers in the evolving protection landscape – AMI Protection Viewpoint 2024.
Consumer expectations
The AMI report found that one in four (28%) consumers believe it should take no more than 48 hours from applying for protection to having it in place for someone with no complex health conditions, and a further 25% expect it to take less than a week. Younger consumers tend to have more realistic expectations, with 21% of Gen Z anticipating a 48-hour turnaround compared to 31% of Gen X.
Regarding claims, 44% of consumers expect a decision within a week, and 27% anticipate receiving payment in their bank account within that timeframe.
Insurer service
For the first time, AMI explored advisers’ perspectives on insurer service levels. The results showed mixed views, with no clear consensus on whether service levels have improved or declined over the past one to two years. The most diverse experiences were around underwriting. While 28% of advisers reported a decline in service, 20% saw improvements. For claims handling, 16% observed worsening service levels, while 12% noted better performance.
Improving customer retention
The report highlights positive trends in customer retention, with a growing number of advisers actively working to keep protection policies in force. Currently, 65% of advisers are proactively doing something, up from 60% in 2023, with over half (56%) conducting regular policy reviews, and 16% reminding clients of product flexibility and payment deferral options. Among those taking these steps, 44% have seen improvements in customer retention.
While 33% of consumers recalled receiving an annual statement from their insurer, only 16% said it prompted them to review their coverage. Despite consumers believing protection should be reviewed every 13.6 months on average, just 45% with protection have done so in the past year, and 17% have never reviewed their protection at all. Reasons for not reviewing include unchanged personal circumstances (33%), a lack of consideration (25%), and scepticism about the benefits (15%).
The role of the annual statement
Although annual statements have proved to be a prompt to encourage some consumers to review their policies, many are seeking just the basic policy information from an annual statement. Details about how many claims the insurer has paid out sat at the bottom of the list (14% stated they wanted it on their annual statement). The top information requested from annual statements includes:
- 57% want to know what the policy covers
- 48% want to see the premium amount
- 46% want to know the policy end date
- 41% seek guidance on how to make a claim
- 40% want details on exclusions
- 40% want to know about additional benefits
Furthermore, 44% of consumers feel responsible for prompting a review of their protection, while 28% (rising to 32% among Gen Z) think insurers should take the lead. Among existing policyholders, 22% expect advisers to prompt reviews. Younger consumers, particularly Gen Z (27%) and Millennials (24%), are more likely to place this responsibility on advisers.
Similarly, 30% of advisers believe insurers should prompt consumers to review their protection needs, though a greater number (42%) disagree. The majority of advisers (83%) see it as their role to encourage regular reviews.
Robert Sinclair, Chief Executive, Association of Mortgage Intermediaries said: “This year’s report underscores the growing role advisers play in keeping protection policies active, with more clients benefitting from regular reviews and tailored advice. However, the data also highlights areas where the industry can improve, particularly in meeting consumer expectations around policy issuance and claims processing. By addressing these gaps and enhancing communication, we can ensure more consumers are protected when they need it most.
“As we look ahead to the FCA’s upcoming Market Study on the Pure Protection Market, it’s important to recognise that whilst significant, it’s important not to lose sight of our ongoing mission—to ensure UK consumers receive appropriate protection advice every day. This year’s report, ‘Making Protection Personal,’ offers both valuable insights and a four-point action plan designed to help advisers better meet customers’ evolving needs.”
Vikki Jefferies, Market Development Director at Legal & General Retail said: “The findings from this year’s report clearly show that while we have made significant strides in engaging with clients and addressing their needs, there is still room for improvement. By focusing on transparency, ease of access, and personalised advice, we can better serve our customers and ensure they feel confident and secure in their protection choices.
“Importantly, there’s room for us, as providers, to support advisers when it comes to managing client expectations. It’s a challenging but exciting time for the industry. And I believe that by continuing to listen to our clients and adapting to their evolving needs, we can make significant progress.”
Carrie Johnson, Protection Director at Royal London said: “It’s important to hear from consumers on how we are doing, and we’re always keen to listen to this feedback and to continue to improve. While technology has undoubtedly enabled us to offer more sophisticated and personalised cover, along with a broader range of value-added services, it can also create complexity. We need to remember protection products support customers at the most vulnerable times in their lives, so it’s crucial we treat them fairly and quickly when they need us.”
Joanna Streames, Velvet Mortgage and Insure Services, said: “The findings highlight the growing importance of transparency and clarity in annual statements. It’s encouraging to see that receiving statement prompt some people to review their cover. The disparity in what consumers find most valuable suggests there is still work to be done to ensure statements are tailored to client needs, particularly for younger generations.”
The new AMI Four-point Action Plan
Following this research and an additional community group study with 16 participants, AMI has devised the following four action points to help advisers and insurers build more understanding and empathy with clients and potential clients:
1 – Build in a human element upfront – take time to understand personal circumstances and situations before explaining products
2 – Make products easy and accessible – avoid jargon and find ways to make them easy to understand
3 – Allow clients to feel in control – give them time to think about them, research them and ask additional questions
4 – Focus on the positives – highlight how the products can provide help in the worst situations, share examples of this and reassure clients that they have real value.
To read the report in full and to view the virtual event held on Tuesday 5th November, please visit AMI Protection Viewpoint 2024.
