The Chief Executive Officer of Protection Review, the organisation that provides independent review of the UK’s health and protection insurance industry, spoke at its annual conference in London on 27th November 2024.
Kevin Carr gave the opening address and chaired a session entitled “The Perfection Gap”. In his address, Mr Carr said that the Financial Conduct Authority was right to review the protection insurance market, as “there are areas to improve”.
What are protection products, and why do they need a review?
The protection insurance market offers policies to help people when circumstances change, such as loss of employment, serious illness or death. They can provide peace of mind and financial security by paying a lump sum or regular amount to cover mortgage, rent and household bills.
The Financial Conduct Authority (FCA), the financial industry’s watchdog, announced a review of protection products in August 2024 as part of its wider Consumer Duty. The FCA was concerned that not all products offered ‘fair value’ to customers, for example, mis-selling cases had been identified, where policyholders were encouraged to switch to another policy unnecessarily, just so the adviser received an additional commission.
Mr Carr reminded the audience at the Protection Review conference that some unscrupulous advisers were telling existing policyholder they no longer needed to disclose specific health issues and could save money as a result. “The new application is lying, and the policy may never pay out”, he said.
