The protection market is witnessing a surge in innovative product offerings that address emerging risks . The COVID-19 pandemic has underscored the importance of protection against unforeseen health crises and business disruptions , leading to the introduction of pandemic-related insurance products but , most importantly , it has raised the awareness of income protection and how beneficial this can be in times of financial difficulty .
Financial institutions are increasingly recognising the value of providing holistic protection solutions that encompass various risk categories . Guardian , as an example , has introduced income protection to its suite of products and this integrated approach combines life , health and disability insurance into packages that offer comprehensive coverage and simplify the insurance-buying process for consumers . These solutions cater to individuals and businesses seeking a one-stop-shop for their protection needs , enhancing convenience and promoting a more comprehensive risk management strategy .
REGULATORY FRAMEWORKS PLAY A PIVOTAL ROLE IN SHAPING THE PROTECTION MARKET
Authorities are keen on ensuring consumer rights , fair practices , and solvency of insurers and this is currently being driven by Consumer Duty . Stricter regulations related to data protection are influencing how insurers handle customer data and communicate risks . Additionally , regulations are evolving to accommodate new forms of insurance , such as parametric insurance that pays out based on predefined triggers rather than traditional claims processes .
The growing awareness of environmental and social factors is influencing protection offerings . Insurers are exploring environmentally conscious products and you may have already heard of Zurich already considering issues such as coverage for renewable energy projects , climate-related risks , and environmental liabilities . Moreover , the focus on social responsibility is driving insurers to offer coverage that addresses societal challenges , such as public health emergencies and customer support initiatives .
Distribution channels for protection products are diversifying to cater to evolving consumer preferences . While traditional channels like insurance advisers remain relevant , digital platforms are gaining traction . Direct-to-consumer models , online comparison sites , and partnerships with e-commerce platforms are reshaping how protection products are marketed and sold . Additionally ,, collaborations between insurtech startups and established insurers are driving innovative distribution strategies .
Whilst the protection market is undergoing positive transformation , it also faces several challenges . Consumer education and awareness about the importance of protection remain areas of concern . Many individuals and businesses still lack a comprehensive understanding of the risks they face and the appropriate insurance solutions available . Additionally , regulatory compliance and keeping pace with technological advancements pose operational challenges for insurers and financial institutions , as well as advisers .
The landscape of the protection market within the financial services industry is evolving rapidly , driven by changing consumer expectations , technological disruption , and regulatory dynamics . Insurers , financial institutions , and insurtech startups are innovating to offer personalised , technologically advanced , and holistic protection solutions . The emphasis on consumer-centricity , digital transformation , and innovative product offerings is reshaping how protection is perceived , accessed , and experienced . As the protection market continues to evolve , stakeholders must navigate challenges and seize opportunities to provide comprehensive , relevant , and accessible protection solutions that meet the needs of a rapidly changing world .
SimplyBiz is here to support you with the ever changing landscape so if you want to know more about any of the topics discussed then please contact our Protection Helpdesk at protection @ simplybiz . co . uk or come along to one of our many in person and digital events that are taking place .
| PROTECTION ADVISER | AUTUMN 2023 | 7