The Currency analytics
By Bruce Buterin
Britain's financial watchdog wants insurers to do better. The Financial Conduct Authority dropped its interim findings this week, and the message is pretty clear: too many people…
More than half of UK adults don't have pure protection products, according to the FCA's competition review.
Graeme Reynolds runs competition at the FCA and also handles insurance duties on an interim basis.
Some firms already show good value for customers, the FCA noted. The regulator will crunch updated 2025 data for its final report, which should land in Q3 2026.
Industry feedback closes March 31, 2026.
Pure protection insurance covers three main areas: life insurance, critical illness coverage, and income protection.
The FCA also wants to streamline how people buy these products. Right now the sales process is pretty complex, which probably explains why uptake stays so low.
Clear communication matters here, the FCA said. People can't make good choices about their financial security if they don't understand the options.
Fresh 2025 data will drive the FCA's final analysis. The authority wants to use current market information to back up any changes it proposes.
Insurance providers and consumer groups have until March to weigh in. The FCA particularly wants insights from these stakeholders since they see the market from different angles.
Marketing strategies also need examination, according to the FCA. Too many consumers still don't know about protection product benefits.
The FCA's push fits into broader regulatory work on financial inclusivity. By January 2026, the authority plans workshops between insurers and consumer groups.
Digital platforms might expand consumer reach, the interim report suggested. Online tools could simplify purchasing and make protection products more visible to potential buyers.
Stakeholder feedback will be crucial for the final report. Major insurers like Aviva and Prudential are expected to share market experiences and insights.
But the regulator didn't specify exactly which digital partnerships it's considering or give timelines for the pilot programs.