What you need to know
In 2019, new premiums of critical illness insurance grew for the fourth consecutive year, with the value of new premiums up 2.8% to £291 million. The volume of new policies increased even faster over the past two years, increasing 9.2% in 2019. This has resulted in a drop in average premiums, reflecting a competitive market. In 2018, Guardian entered the top-end of the market and has since set new benchmarks in terms of coverage for the rest of the industry to follow.
Critical illness cover has long suffered from being a more complex form of protection, and it is for this reason that the sector risks losing out to income protection cover, which is easier to understand. But the industry appears to be moving in the right direction with many of the leading players making moves to improve transparency and simplify definitions. There remains plenty of scope for improvement in how the industry communicates with consumers and advisers, but there is significant latent potential in the market for those that get it right.
Products covered in this Report
This Report examines the UK market for individual critical illness cover.
Critical illness cover is a long-term policy designed to pay a tax-free lump sum to the policyholder on the diagnosis of specified illnesses and medical conditions such as cancer, heart attack and stroke. The number and range of medical conditions covered can vary considerably between insurers and, increasingly, even between policies from the same insurer.
Critical illness cover can be purchased on its own (as a standalone policy) but is more commonly bought alongside other types of insurance (as a ‘rider’ benefit) such as term assurance. It can be taken out on a joint or single basis, and some policies also cover children either as standard or as an optional extra. Policies can either be linked to a mortgage term or be separate.
The focus of this Report is critical illness insurance, but it also references related products such as term assurance and income protection. For more detail on these specific products see:
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Mintel’s Term Assurance – UK, June 2019 Report
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Mintel’s Income Protection – UK, March 2019 Report
