"Insurers need to move towards a system of embedding insurance into the digital ecosystems consumers already use, such as banking apps, mortgage tools, and payroll platforms."
According to the Financial Conduct Authority’s (FCA) Financial Lives Survey, nearly half of adults in the UK (49%) show signs of financial vulnerability.
Defined as a state where an individual or household is at a higher risk of experiencing financial hardship due to their personal circumstances, financial vulnerability is becoming the new reality.
Recent data shows that over 148.9mn working days were lost due to ill-health or injury in 2024. And yet, the vast majority remain unprotected against shocks that could upend their financial stability.
Our research in partnership with the HomeOwners Alliance and Canopy revealed a staggering 2.3mn mortgage holders and 4mn renters don’t have Income Protection (IP). This suggests that the number of consumers without IP in the property/rental market stands at over 6mn in the UK alone.
READ MORE: 54% of 18-34-year-old homeowners claim to have life policies but majority don’t know about IP
Without the safety blanket of protection to support them when the unexpected occurs, many could be left unable to pay their monthly mortgage or rental bills which could, in extreme cases, lead to repossession of property.
Despite this consequence, protection products continue to feel dated, complex, hard to access, and difficult for many to relate to. With the stakes so high, we must adapt.
“When advice is inaccessible, and protection products are wrapped in inflexible terms or off-target marketing, consumers can’t engage.”
Over the last decade, embedded insurance has already transformed customer experience, from insurance automatically tailored to a trip length when booking via apps to new phones including personalised cover to the device and local repair options.
Meanwhile, the protection market is a late adopter, so the gap between what consumers need and what they get has widened. But it’s exactly this experience-led mentality that we should be driving towards.
“If anything, this should serve as an urgent wake up call for the market to innovate and adapt for the future.”
Instead of forcing consumers to jump through hoops, embedded insurance weaves cover directly into journeys for products or services they already use in their everyday lives.
But, with only 10% of c-suite executives confirming their top priority for 2025 is embedded insurance, it’s still in nascent stages.
At LifeSearch, we believe embedded insurance is the future and we’re already building towards it through a partner-led model which powers protection advice and digital journeys for trusted brands.
“To close the protection gap, we must build with (not just for) consumers and design products with real lives in mind.”
Insurers need to move towards a system of embedding insurance into the digital ecosystems consumers already use, such as banking apps, mortgage tools, and payroll platforms.
It also means shifting from a ‘push’ mentality and letting insurance surface naturally, in a language and tone that feel human.
