I bet the protection industry would love it if people in the UK boasted about how much life cover they have in a similar way to our friends over the pond in the US.
In the US, life insurance seems to be part of society’s make-up and business people are apparently often heard to say statements like, "you’re nobody if you don’t have $5m of life cover" and even try to out-do each other by boasting about the amount of insurance they have.
But here in the UK consumers have traditionally been indifferent towards life cover and many don’t even consider it until they receive financial advice.
Tony Jupp, chief underwriter at Norwich Union, believes life insurance in the UK needs to become more of a partnership between consumers and insurers and he suggests the UK could learn some lessons from the US.
But part of the reason why people in the US are more attuned to life cover might be because they do not have an NHS and are therefore used to buying health and medical insurance.
Jupp says life insurance in the UK will have to be a two-way process in the future because otherwise people will miss out on the benefits.
The NHS is working on a central computer and this may result in consumers having all their medical history on a card, which insurers could put through a scanner and immediately accept or decline the consumer for cover.
But, knowing the NHS, it could be years before the system is introduced and by then there could be numerous medical or underwriting developments.
Norwich Union spent £12m on medical evidence last year to understand consumers’ risks and Jupp says the industry needs to find new ways of encouraging people to take more interest in the market.
Perhaps we need some speeches from the government like the one President Eisenhower made in 1964: "One of the clearest evidences of the faith of our people in the free institutions and the future of America is the fact that many millions of our citizens have life insurance policies."
Who’d have thought you could relate life insurance policies to freedom and democracy?
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Emily Perryman on 020 7968 4554 or email [email protected].IFAonline
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