"2024 was another busy year in the UK, both politically and economically."
- Joanna Scott, technical manager & industry affairs manager L&H UKI at Swiss Re
Swiss Re’s ‘Term & Health Watch’ Report (in conjunction with iPipeline) has revealed a 2.2% increase in new long-term individual protection policies sold in 2024. 2,041,428 new Term Assurance, Whole of Life (WOL), Critical Illness (CI), and Income Protection (IP) policies were purchased.
Despite this, Term Assurance (including those with a CI benefit) sales declined by 11,577 policies (0.8%), and new guaranteed acceptance WOL purchases fell by 1.5%. Notably, sales of underwritten WOL policies without a CI benefit decreased by 8.2% following several years of continued growth.
In contrast, the number of new Decreasing Term Assurance (DTA) policies rose by 3.6% - 2023 saw the lowest level of sales since 2016. The number of new Term Assurance-only policies remained flat.
There was an 18% increase in new IP policies in 2024 (vs 10% in 2023), with 49% of new policies having a limited payment term (LPT). While new two-year LPT policies increased by 1.3% in 2024 (12% in 2023), Normal Retirement Age (NRA) policies that potentially pay benefits up to the policy expiry term increased by 36.6% (vs 12% in 2023).
Standalone Critical Illness (SACI) sales increased by 36,497 in 2024, while Term with CI sales fell by 11,289. The total number of new CI policies, attached to life cover and standalone combined, increased by 2.5%, to 545,251.
Joanna Scott, technical manager & industry affairs manager L&H UKI at Swiss Re, believes these findings are reflective of another unpredictable year for UK households, with a change of Government and rising geopolitical tensions.
She said: “2024 was another busy year in the UK, both politically and economically. In a continued high-interest rate environment with cost pressures mounting for households, it’s encouraging to see so many pockets of positivity, not least in the realm of IP and DTA sales.
“This was in no small part due to improvements in the mortgage market. Looking ahead, a defining feature of the second half of 2025 will be maturing mortgages from the COVID-19 Pandemic house buyers’ cohort. With the holders of cheaper fixed-rate mortgages facing an increase in repayments of 200bps-250bps, it will be interesting to see what impact this has on protection take-up.”
Discussing the increase in NRA IP and one-year & two-year LPT sales, Joanna said this is particularly significant. Highlighting the ‘Keep Britain Working’ Review, led by Sir Charlie Mayfield, she explained that the Government is on a “clear mission to keep people in work as part of its plans to boost productivity.
“But it has also highlighted the role of IP in supporting people both financially and medically, while minimising Government spending. Sales of NRA and LPT products are now split 51:49. This is hugely positive when considering the potential impact on the welfare state if an employee is unable to return to work before the end of a policy’s payment period.”
Commenting on these findings, Paul Yates, product strategy director at iPipeline, said, “Advisers are increasingly realising greater value from the protection market as they refine their sales and recommendation processes to better meet their customers’ holistic protection needs. Our latest data highlights improved efficiency, with stronger quote-to-policy conversion and a growing preference for multi-benefit plans – increasing product density per customer.
“We’re also seeing a clear shift toward quality over cost, with advisers placing less emphasis on just the lowest-priced options. The continued growth in APE (£) relative to new policy volumes underscores this trend. It’s a compelling sign that advisers are delivering more comprehensive protection solutions for their customers.”
