Sales of income protection have increased in each of the last four years, increasing by an estimated 7% in 2018. Average premiums have fallen, as providers have lowered the cost of policies in order to reach a wider market. Income protection is still predominantly sold via advisers during the mortgage application process, and as such is heavily reliant upon conditions in the housing market.

Loans for house purchases fell in 2018 for the first time since 2012, which further highlights the need for providers to look to attract other customer groups, such as renters. Further education is required to inform consumers about their financial resilience, with many overestimating their ability to cope with a loss of income.

There is scope for providers to increase the level of personalisation in terms of the benefits they offer in order to target different groups. New technology will also provide an opportunity to recommend products at a much faster rate.

This Report looks into the size of the income protection market, and the drivers which have a significant influence. Mintel’s consumer research examines ownership of income protection in comparison to other protection products, before looking at the expected impact of a loss in income. It also examines attitudes towards employer sickness policies and income protection as a whole. Finally, the Report focuses on interest in various protection products, and the extra benefits which income protection providers can offer.

For product definitions see Appendix – Data Sources, Abbreviations and Supporting Information.