Income Protection Action Week: growing the protection market

Alan Waddington, Distribution Director at Cirencester Friendly, reflects on the rising importance of income protection in today’s climate. With financial pressures mounting, health services under strain, and a heightened public awareness of vulnerability in the post-pandemic world, advisers play a crucial role in keeping protection conversations alive.

Why is income protection more important now than ever before? 

In a post-pandemic world, ordinary people are more aware of their vulnerabilities than ever before. They know anyone can suffer ill-health. They feel their finances being squeezed. They see a health service struggling to cope with demand. All this creates a sense of fear and anxiety. Income protection offers them a way to take back some control, giving them a degree of certainty in an ever more uncertain world. 

If you could offer one call to action to advisers during Income Protection Action Week, what would it be? 

My one, overriding message would be check in with your clients. Protection needs change as peoples’ lives evolve. You need to keep the conversation going so you know what is going on in their lives and can ensure their cover remains fit for purpose. It is also a fantastic opportunity to remind them of the additional services that come with that cover that can be accessed at any time and offer hugely valuable support for the finances, health and wellbeing. 

What trends are you seeing in client awareness or demand for income protection products? 

How has the current economic climate (cost of living, inflation, etc.) changed the nature of protection conversations? 

We are seeing a demand from protection coming from younger generations. While those in their 20s are increasingly aware of income protection and its benefits, the growth in sales is really coming from millennials, those in their late 20s, 30s and early 40s. These people have settled into a career, have bought their homes or are hoping to do so and beginning to start families. These are all things they have a desire to protect. 

What language, tools, or approaches have you found most effective in helping clients understand the value of income protection? 

We found focusing on enhancing our relationship with advisers has been hugely effective in helping clients understand the value of protection. By listening to adviser feedback, using this to produce relevant and practical materials and striving to make the most of their expertise, we have been more successful in showcasing the benefits of income protection in a compelling way.  

What do you believe that the biggest challenge advisers face when introducing income protection to clients, and how can they overcome it?  

While there are various challenges that advisers face, the three I would urge them to focus on are: 

• Reducing complexity – our products can seem complicated, but using simple, everyday language to explain them goes a long way in helping anyone to understand what they do and why they are important 

• It won’t happen to me – Income protection is there to cover all conditions, not just the serious ones. Common ailments like a bad back or a broken arm which prevent people from working really can happen to anyone and these types of conditions account for a significant proportion of income protection claims 

• It won’t pay out – the vast majority of income protection claims are paid – we have paid out over 94% of claims over the last 15 years. As an industry, we need to be better at getting this message across, using real life examples that people can relate to, demonstrating having cover when needed can be life changing.