By Clare Yates
2 min read
The Financial Conduct Authority (FCA) is asking the insurance industry for ideas on how to help more people access protection insurance, such as life cover, critical illness insurance, and income protection.
These pure protection products are usually designed solely to provide financial support if something goes wrong, rather than building up savings or investments. They can help families cope with major financial shocks, like bereavement, serious illness or losing the ability to work.
Most consumers with cover are well served
The FCA’s interim review shows the market generally works well for people who already have protection. Policies are widely available, claims are usually paid when needed, and the cost of cover has remained stable in recent years.
However, the regulator found that 58% of UK adults do not hold any pure protection cover, leaving millions without a financial safety net.
Why many people do not take out protection
The FCA’s research suggests the gap often comes down to awareness. Many consumers simply never get prompted to think about protection. Other barriers include concerns about affordability, confusion about what policies cover, and areas where the sales process could be improved.
What this could mean for consumers
If the FCA’s review leads to changes, protection products could become easier to understand and compare. That could help people make informed choices and compare protection insurance to find the right policy for their needs.
The regulator is also looking at ways to improve policy switching, ensuring any recommended switch clearly benefits the consumer.
Graeme Reynolds, director of competition and interim director of insurance at the FCA, said:
“These insurance products play a vital role in helping families manage some of the most difficult experiences in life. While competition in the market is mostly working well, many more people could benefit from protection.”
Feedback on the interim findings is open until 31 March 2026, and the FCA plans to publish its final report in the third quarter of 2026.
