Advisers have expressed concerns over insurer service levels – with 28% believing they have worsened in the last two years.
The results were revealed in the Association of Mortgage Intermediaries’ latest protection report.
It found that the speed of underwriting is advisers biggest problem, with 58% raising this as an issue.
However, 49% also cite it as the main reason for seeing an improvement in service standards. Overall, 20% think insurers underwriting is improving.
In terms of claims handling, 16% of advisers observed worsening service levels and 12% said they had seen better performance.
The AMI report, published today (5 November) in partnership with Royal London and Legal & General, aims to make protection more personal.
It also emphasises the need for a stronger customer focus, addressing individual needs and aspirations.
Consumer expectations
The report found that one in four (28%) consumers believe it should take no more than 48 hours from applying for protection to having it in place for someone with no complex health conditions. A further 25% expect it to take less than a week.
Younger consumers tend to have more realistic expectations, with 21% of Gen Z anticipating a 48-hour turnaround compared to 31% of Gen X.
In terms of claims, 44% of consumers expect a decision within a week, and 27% anticipate receiving payment in their bank account within that timeframe.
Improving customer retention
The report highlights positive trends in customer retention, with a growing number of advisers actively working to keep protection policies in force.
Currently, 65% of advisers (up from 60% in 2023) are proactively supporting clients, with over half (56%) conducting regular policy reviews.
And 16% are reminding clients of product flexibility and payment deferral options. Among those taking these steps, 44% have seen improvements in customer retention.
Meanwhile, 33% of consumers recalled receiving an annual statement from their insurer, and only 16% said it prompted them to review their coverage.
Despite consumers believing protection should be reviewed every 13.6 months on average, just 45% with protection have done so in the past year.
In total, 17% have never reviewed their protection at all.
Reasons for not reviewing include unchanged personal circumstances (33%), a lack of consideration (25%), and scepticism about the benefits (15%).
The role of the annual statement
Although annual statements have proved to be a prompt to encourage some consumers to review their policies, many are seeking just the basic policy information from an annual statement.
Furthermore, 44% of consumers feel responsible for prompting a review of their protection, while 28% (rising to 32% among Gen Z) think insurers should take the lead.
Among existing policyholders, 22% expect advisers to prompt reviews.
Younger consumers, particularly Gen Z (27%) and Millennials (24%), are more likely to place this responsibility on advisers.
Similarly, 30% of advisers believe insurers should prompt consumers to review their protection needs, though a greater number (42%) disagree.
The majority of advisers (83%) see it as their role to encourage regular reviews.
The Association of Mortgage Intermediaries chief executive, Robert Sinclair, said: “This year’s report underscores the growing role advisers play in keeping protection policies active, with more clients benefitting from regular reviews and tailored advice.
“However, the data also highlights areas where the industry can improve, particularly in meeting consumer expectations around policy issuance and claims processing.
“By addressing these gaps and enhancing communication, we can ensure more consumers are protected when they need it most.
Legal & General Retail’s market development director, Vikki Jefferies, added: “The findings from this year’s report clearly show that while we have made significant strides in engaging with clients and addressing their needs, there is still room for improvement.
“By focusing on transparency, ease of access, and personalised advice, we can better serve our customers and ensure they feel confident and secure in their protection choices.”
