United Kingdom (UK) Protection Insurance – Whole of Life Assurance

United Kingdom (UK) Whole of Life Assurance Market Report Overview

The whole of life assurance market in the UK was valued at GBP106.3 million in 2023 and the market will grow at a CAGR of more than 1% from 2023 to 2028. The growth is attributed to changing consumer preferences and cost considerations.

UK Whole of Life Market Outlook 2023-2028 (GBP Million)
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The ‘UK Protection Insurance – Whole of Life Assurance’ report provides an in-depth assessment of the market, analyzing current and historical market size related to changes in the whole of life assurance contracts and premiums. It examines how whole-of-life products are distributed, and highlights key changes in the competitive landscape, and the key players’ offerings. The report includes five-year forecasts for market size by contracts and premiums to 2028. It further discusses potential future changes in the market, distribution, and product offerings, along with the reasons behind these changes.

UK Whole-of-Life Assurance Market Drivers

Rising funeral costs in 2023 have sparked a surge in demand for over-50s insurance. In addition, FCA regulations will make it easier to compare over-50s policies and funeral plans. Primarily, concerns surrounding providers’ behavior led to prepaid funeral arrangements falling under the jurisdiction of the FCA started in January 2021. The prepaid funeral plans and over-50s policies are specifically designed to assist individuals with covering funeral expenses. In response to the concerns, the FCA conducted a consultation and implemented standards aimed at ensuring ethical business practices, fair pricing, and customer-centric strategies. In addition, advertising restrictions have been introduced to enhance fairness and transparency.  According to SunLife, prepaid plans are utilized by a larger percentage of individuals compared to over-50s policies, resulting in direct competition between the two products.

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UK Whole of Life Assurance Market Segments

The key segments in the UK whole-of-life market are guaranteed acceptance policies and underwritten policies. In 2023, underwritten policies accounted for the highest share of premiums. A growing shift among consumers toward ensuring financial protection for their families in the event of unforeseen circumstances could further strain their finances.

UK Whole of Life Assurance Market Analysis by Segments, 2023 (%)

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UK Whole of Life Assurance Market Segmentation by Distribution Channel

The key distribution channels in the UK whole of life assurance market are advised, non-advised, and direct. In 2023, the direct channel was the favored distribution channel for guaranteed acceptance products with more than 50% share of premiums.

UK Whole of Life Assurance Market Analysis by Distribution Channel, 2023 (%)

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UK Whole of Life Market Assurance Market – Competitive Landscape

The key insurers in the UK’s whole of life assurance market are SunLife, AIG, and Scottish Friendly. In 2023, SunLife dominated the whole of life market assurance. It specializes in offering guaranteed acceptance insurance without the need for medical exams or health inquiries.

UK Whole of Life Assurance Market Analysis by Insurers, 2023 (%)

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UK Whole of Life Assurance Market – Recent developments

• In February 2024, Scottish Friendly partnered with FinTech Scotland to enhance fintech innovation in the financial sector, particularly across life insurance, savings, and investments. This collaboration will focus on leveraging technology to streamline processes, improve the customer experience, and make life insurance more affordable and accessible.
• In November 2023, AIG Life introduced a new underwriting rules engine and enhanced intermediated underwriting journey with over 50 improvements aligned with the FCA’s Consumer Duty rules. The engine features simplified questions and faster decisions, utilizing Swiss Re’s Magnum Pure technology. Customer feedback and testing were used to refine the process, resulting in a more streamlined and customer-friendly insurance application experience.

Segments Covered in the Report

UK Whole of Life Assurance Market Segments (2023)

• Guaranteed Acceptance Policies
• Underwritten Policies

UK Whole of Life Assurance Market Outlook by Channels (2023)

• Advised
• Non-Advised
• Direct

Scope

• SunLife dominated the whole of life insurance market in 2023, holding a 51.9% share of contracts, while second-placed AIG accounted for just 15.8%.

• The use of providers’ apps for over-50s insurance purchases saw a notable rise from 4.7% in 2022 to 8.1% in 2023.

• 52.1% of individuals aged 18 to 24 express comfort with AI-powered chatbots, compared to only 12.6% of those aged 70 and above.

Key Highlights

• SunLife was the top provider in 2022 due to its dominant position in the over-50s market.
• Innovations target simplifying underwriting for mental conditions, as well as creating products that cater to individuals who cannot make monthly payments due to the cost-of-living crisis.
• Further investments in digitalization should make whole-of-life products more accessible to tech-savvy individuals, potentially increasing the customer base.

Reasons to Buy

• Examine the size of the whole of life assurance market.
• Identify the leading providers of whole of life assurance.
• Learn about the implications of the cost-of-living crisis on the market.
• Understand the influence of a variety of factors on market growth.