Insurers increased their market share in the critical illness market during 2020, according to the latest GlobalData 2020 consumer survey, with brokers maintaining their position and banks losing out.
Analysts say this increase was due to efficient digital channels, which have enabled them to grow market share in a period that has seen a number of national lockdowns and decreased economic activity.
This data shows that within the CI market, insurers accounted for 42.4 per cent of sales in 2020, up from 34.1 per cent from the previous year. At the same time the banking channel has seen its marketshare fall, from 18.2 per cent in 2019 to 11.3 per cent last year. Policies sold via brokers have remained level, at 33.1 per cent, a marginal decrease on the 32 per cent record the year before.
GlobalData insurance analyst Daniel Pearce says that the decline in the banking sector may be due to falling footfall in bank branches because of the coronavirus pandemic.
He says: “While providers in other channels are well established in the sale of policies through digital channels, those in the banking channel have clearly struggled to make the necessary changes in order to remain competitive.”
He adds that this fall is likely to have been further exacerbated by closure of the housing market during the first national lockdown. Over this period the number of mortgage advances fell significantly, and reduced the ability of banks to cross-sell protection products, such as a critical illness policy.