Report highlights shift in protection conversations
The Association of Mortgage Intermediaries (AMI) has released preliminary findings from its 2024 Protection Viewpoint Report, highlighting a notable increase in engagement around protection insurance, particularly among Gen Z consumers. The report, titled Making Protection Personal, will be officially launched on November 5, in collaboration with Royal London and Legal & General.
AMI’s study surveyed 3,000 consumers and over 300 advisers, revealing that 65% of Gen Z respondents consider income protection important, with 13% already holding such policies. In contrast, only 48% of Gen X view income protection as vital, with just 5% currently insured. This data indicates a significant shift in attitudes toward financial security among younger consumers.
Key findings from the report suggest that the implementation of Consumer Duty has positively influenced adviser-client interactions, leading to increased conversations about protection. According to the research, 41% of advisers reported more discussions about protection insurance, while 31% are covering a broader range of products compared to the previous year. Notably, the percentage of consumers initiating discussions about protection with their mortgage advisers has risen from 11% in 2023 to 21% in 2024.
Robert Sinclair (pictured), chief executive of AMI, emphasised the importance of personalising protection to meet individual customer needs. “Over the past five years, we’ve gathered important insights, and we’re excited to share actionable ideas to help firms and advisers overcome the barriers identified in our study,” Sinclair stated.
Shifts in adviser-client dynamics
The report also highlighted the changing dynamics of adviser engagement. About 44% of consumers reported that their adviser initiated conversations about protection, reflecting a slight decrease from 50% in 2023. Nonetheless, a growing number of consumers, particularly those from Gen Z, are taking the lead in these discussions, indicating a cultural shift in financial responsibility.
Adviser interaction remains critical, with 29% of protection policyholders seeking advice. Of these, 34% recognised the advice as valuable due to face-to-face interactions, a figure that rises to 56% among Baby Boomers. Additionally, 15% of those who did not secure protection expressed that earlier conversations with their advisers could have influenced their decisions.
Carrie Johnson, protection director at Royal London, described the Consumer Duty as a “game changer for customers.” She noted that the quality of advice and services is improving, and the growing interest in protection among younger demographics presents an opportunity for advisers to enhance their practices.
Vikki Jefferies, market development director at Legal & General Retail, echoed this sentiment, stating that tailoring protection to individual needs is crucial for modern consumers. “The upcoming report highlights the great work and progress that we’re seeing, but also some key learnings and areas of opportunity,” Jefferies said.
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