Charlie MacEwan, corporate communications director of WPA, said: “The corporate deductible should have revolutionised everything by now but people were suspicious of something different. It was the same with corporate healthcare trusts in the 1990s and they have only really taken off during the past 10 years. Innovation takes time and but it is something that the industry has to do.”
Nevertheless, plenty of commentators argue that innovation makes life more confusing for consumers when the main barrier to sales is lack of understanding rather than faults with existing products. This school of thought has been gaining particular momentum of late.
Roger Edwards, managing director of Bright Grey and Scottish Provident, said: “For the first time in about 15 years I’m hearing more people actually saying we’ve had enough innovation and let’s go back to simpler basic things.”
But innovation and simplicity do not actually have to be mutually exclusive. Exeter Family Friendly, for example, prides itself on being innovative in terms of simplifying insurance and making it accessible.
Graeme Godfrey, managing director of specialist intermediary Best Go Private, rates its simple PMI plans health cover for me and health choices for me far more highly than PruHealth and described them as “the best new innovative products we’ve had for a number of years”.
So, although innovation was largely put on hold last year in the build-up to the retail distribution review and G-Day, maybe 2013 could turn out to be a year of both product innovation and simple products. It will certainly be interesting to see whether the Sergeant Review of simple financial products provides any worthwhile food for thought for product development departments.
Edmund Tirbutt is a freelance journalist
How real life cover works
The cover is made up of two ‘pots’ of money:
* A life insurance pot that will pay out if death occurs during the term of the plan.
* A living fund pot will pay for IP, limited CI cover, or child and partner carer’s cover claims during the term of the plan up to the overall sum insured. It will also pay for recuperation cover.
Key Points
Ageas Protect’s launch of real life cover met plenty of accolades when launched but has drawn few sales.
Feedback from the market suggested that, while IFAs can often give a very positive response to ideas during research, projects frequently fall down when it comes to trying to persuade conservative network compliance officials to put products on their approved lists.
Plenty of commentators argued that innovation made life more confusing for consumers when the main barrier to sales was lack of understanding rather than faults with existing products.
