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December 21, 2016updated 26 Jan 2022 3:11pm

Protection insurance trends in 2016 and outlook for 2017

Kevin Carr, chief executive of Protection Review, reviews the key trends that have shaped the protection insurance market in 2016 - and forecasts many positive developments for the sector in 2017, such as simpler products and more use of technology including apps and e-signatures

By Verdict Staff

Kevin Carr, chief executive of Protection Review, reviews the key trends that have shaped the protection insurance market in 2016 – and forecasts many positive developments for the sector in 2017, such as simpler products and more use of technology including apps and e-signatures

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What will drive the cyber insurance market over the next 3 years?

The global cyber insurance market was worth $7bn in gross written premiums (GWP) in 2020. It will reach $20.6bn by 2025, as the market will continue to thrive post-COVID-19. Our recent report on Cyber Insurance reveals that cybersecurity was thrust into the spotlight in 2020 as COVID-19 forced businesses to digitize their processes and adopt remote working practices overnight. The pandemic also presented an opportunity for cybercriminals to exploit global panic, with a surge in cyberattacks occurring in 2020. The need for cyber insurance is apparent, but the market is not as easy to navigate as it once was. Use our report to guide and help you to:
  • Benchmark yourself against the rest of the market.
  • Ensure you remain competitive as new innovations and insurance models begin to enter the fray.
  • Prepare for how regulation will impact cyber insurance over the next few years.
Download the full report to understand what to expect and how to align your business for success.
by GlobalData
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2016 ends on a welcome high for the protection industry with reports of IP and CI sales both increasing significantly.

Protection insurance sales jumped by more than 8% in Q3, according to Touchstone, and year on year, overall protection sales are up by 25%.

Reinsurer Gen Re also recently reported a significant increase in protection sales in the first half of the year. According to the firm’s Protection Pulse report, total protection premiums were up by 5% this year compared to the first half of 2015, with income protection sales up by more than 18%.

This trend is very encouraging so let’s hope it continues.

There were also a few perhaps unexpected political events across the globe in 2016, which you may have read about, although these are yet to directly impact the UK market. If more people are concerned about their finances then protection is rarely top of the wish list, even if that’s the time when people may need it most. 

Outlook for 2017

Next year, I expect we’ll see more simple products (like AIG Key3); more use of rewards and benefit packages;  a greater focus on income protection; more use of technology such as apps and e-signatures;  a wider focus on engagement and well-being, and more insuretech start ups.

On the product front, it may well be a case of evolution rather than revolution as companies look at adapt and personalise their existing propositions, including offering products covering specific areas such as diabetes.

The Seven Families project has been considered a success in 2016 and it will be interesting to see how that develops in future years. The IPTF has a few ideas for 2017, which could bridge the gap between a new version of the project in 2018.

In other areas, the slower than expected adoption of ‘wearables’ is starting to feel a bit like the death of vinyl records in the 80s, with ‘nearables‘ becoming the new buzz word.

On the flip side, the growing availability of home-kit genetic testing will also play a part in shaping the market.

Tests are already available online for under £200 that check for 100s of different conditions from one blood sample, with results in weeks, and that raises a number of questions for the industry.

CI trends

Critical illness cover in particular could be set for an overhaul if the tests become more widespread and affordable.

There are millions of pounds being poured into developing and promoting these services globally, which will become far more common in the years ahead, with some companies around the globe promoting the checks as a Christmas present for loved ones.

And of course there’s lots for insurers to focus on as always – from Solvency II and cyber security to annual statements and rebroking, there’s no shortage of demand from different corners of the market.

As long as prices continue to fall and products improve brokers will always look to re-broke healthy clients – it’s their job to get the best deal after all.

So, we can expect to see lots of positive developments next year, including from the portals and underwriting engines.

It feels like there are a growing number of companies who are beginning to focus on growing the market, rather than just their share of it, which is refreshing and hopefully rewarding.

 

 

 

 

 

 

 

 

 

Free Report
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What will drive the cyber insurance market over the next 3 years?

The global cyber insurance market was worth $7bn in gross written premiums (GWP) in 2020. It will reach $20.6bn by 2025, as the market will continue to thrive post-COVID-19. Our recent report on Cyber Insurance reveals that cybersecurity was thrust into the spotlight in 2020 as COVID-19 forced businesses to digitize their processes and adopt remote working practices overnight. The pandemic also presented an opportunity for cybercriminals to exploit global panic, with a surge in cyberattacks occurring in 2020. The need for cyber insurance is apparent, but the market is not as easy to navigate as it once was. Use our report to guide and help you to:
  • Benchmark yourself against the rest of the market.
  • Ensure you remain competitive as new innovations and insurance models begin to enter the fray.
  • Prepare for how regulation will impact cyber insurance over the next few years.
Download the full report to understand what to expect and how to align your business for success.
by GlobalData
Enter your details here to receive your free Report.

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