Complexity putting people off protection

Published on

Aegon

New research, commissioned by Aegon UK and carried out by NMG Consulting in June this year, has looked at the reasons why people don’t buy protection products.

The findings, which came from a survey of 500 sole/joint household financial decision makers aged between 25 and 60, identified four key barriers stopping people from buying protection – price, complicated products, a complex application process and lack of confidence in providers to pay claims.

Only 35% of respondents currently held protection policies. A further 35% who don’t currently hold protection would consider taking it out, which indicates an acknowledgement of the need for protection. The remaining 30% of respondents don’t hold and wouldn’t consider a protection policy.

Of those who would consider protection policies, 66% highlighted expense as a barrier, 63% were concerned by whether or how much they would pay out and 41% said they were too complicated with too much small print.

The reasons given by those who would not consider protection policies were similar with 48% identifying expense, 41% not trusting them to pay out and 16% saying they were too complex.

And, despite some good experiences, these barriers to consideration generally outweighed the perceived benefits of protection.

John Wilkinson, Aegon UK protection director, said: “These barriers are preventing people from actively ‘wanting’ protection forcing the protection gap to continue to widen, but our story doesn’t end here.

“It’s easy to identify the protection need, but the conversion of a customer ‘need’ to a ‘want’ for protection has always been difficult. The role of an adviser in helping a client see the value of protection is pivotal. We believe our Simply Life product can help, and advisers like our solution.”

John Wilkinson continued: “It’s time to stop talking about the protection gap and start embracing the solutions out there. There are unprotected people out there with a clean bill of health and simple protection needs looking for a simple solution.”

COMMENT ON MORTGAGE SOUP

We want to hear from you!
Leave a comment and get the conversation started.
You need to register to post, so please login or sign up below.

Latest articles

Access FS partners with The Protection Coach to shift adviser conversations

Access Financial Services has announced a new partnership with Matt Chapman, widely known across...

Beyond the walk: Mortgage leaders talk mental health – part 6

The Mortgage Industry Mental Health Charter (MIMHC) is hosting its third annual 144-mile Walk...

Gatehouse Bank raises income multiples across home purchase plans

Gatehouse Bank has increased its finance-to-income ratios across its home purchase plan range, allowing...

Landlords retreat from London market as rental stock tightens

Landlords have been exiting the London market since proposals for rental reform first emerged,...

Landlords brace for RRA impact as tenant stability holds firm

Landlords are preparing for significant change as the Renters’ Rights Act 2025 comes into force with...

Latest publication

Other news

Access FS partners with The Protection Coach to shift adviser conversations

Access Financial Services has announced a new partnership with Matt Chapman, widely known across...

Beyond the walk: Mortgage leaders talk mental health – part 6

The Mortgage Industry Mental Health Charter (MIMHC) is hosting its third annual 144-mile Walk...

Q&A: Terry Blackburn, The Wealthy Advisers Club

Mortgage Soup fires the questions at Terry Blackburn, founder of The Wealthy Advisers Club. Mortgage...