The Financial Services Authority (FSA) is thinking about dividing insurance into two categories - one more complex and one less so. But while it is pretty much set that critical illness and income protection will be in the higher-risk category, industry views are divided on whether life cover should follow suit. Where do you think the cover should be and why?
This resonates with the disturbed thinking behind the Retail Distribution Review (RDR) proposals that the consumer is better served by a division of the advice process. This thinking is doomed by the fact that plans can include life, critical illness (CI), income protection (IP), redundancy and total and permanent disability cover. Even if the concept was sound - which it is not - the use of menu plans provides too many obstacles for such a system to work. Protection insurance is not simple. Plan options, trust wordings and buy-back cover, for example, all make for complexity. This swin...
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