UK Critical Illness Insurance: Distribution Dynamics 2024

UK Critical Illness Insurance: Distribution Dynamics 2024

Summary

This report explores how critical illness insurance customers' purchasing preferences have changed over time. It identifies the most important factors driving critical illness purchases and reveals the most popular providers in the market. In addition, the report discusses the key trends and innovations that will influence the market over the next few years.

In 2024, brokers experienced a 7.2 percentage point (pp) increase compared to 2023. As in the broader protection market, the distribution of critical illness insurance heavily relies on the broker channel. This is because consumers seek clarity on the coverage provided by policies. Growth in the broker channel can also be attributed to consumers’ concerns about the illnesses covered by policies.

Scope

• The insurer channel declined by 2.8pp in 2024, while the bank channel witnessed a 1.5pp increase. The size of the broker and bank channels in this sector limits the reach of insurers, which helps explain this decline.
• 47% of customers cited support in case of contracting a serious illness as a key policy feature, representing a significant increase of 39.5pp in 2024 compared to 2023. NHS waiting times have played a crucial role in driving this growth, while consumers are also gaining a better understanding of critical illness products and their associated benefits.
• Aviva remained the leading provider of critical illness insurance in 2024 with a market share of 29.2%. However, its share declined by 2.1pp compared to 2023.

• Understand consumer purchasing decisions in the critical illness insurance space and how these will influence the market over the next few years.
• Improve customer engagement by recognizing what is most important to them and how to adapt products and services to meet their needs.
• Compare the Net Promoter Scores of key insurance providers.
• Discover which providers lead the way in the critical illness insurance space and learn about new product innovations.
• Adapt your distribution strategy to ensure it still meets customer purchasing behaviors.