Banks and building societies make 'substantial' gains
Sales of pure protection products fell by 1% in the last year, compared to the previous one, largely as a result of a 7.7% fall in sales of income protection (IP) and a 25.6% drop in standalone critical illness (CI) sales, according to figures collected by the Financial Services Authority (FSA).
The decline in mortgage sales has hit both providers and intermediaries, the FSA reports, while the market share of the five largest providers now exceeds 60%. Banks and building societies gained "substantial share" as providers, to the detriment of insurance companies. According to separate figures from Swiss Re, Lloyds Banking Group has the largest share of CI sales (130,186 sales in 2010, compared to 74,609 by the second largest provider Legal & General) and is the third largest provider of term assurance and income protection. HSBC leads the IP market.
Almost nine in ten (89%) of pure protection contracts were sold through intermediaries, up from 86% the previous year, most driven by IP products, 60.9% of which are sold by IFAs according to Swiss Re.
Sales of CI sold as a rider increased by 2.8%
The FSA figures are based on sales between April 2010 and March 2011 reported by 67 firms. They cover both direct sales and sales via intermediaries.