A study by the UK’s Financial Conduct Authority (FCA) is to be launched to determine the effectiveness of pure protection insurance, and whether it is in policyholders’ interest to underwrite this type of policy. The FCA fears a poor return on investment for policyholders.
The study, scheduled to begin in 2024 and no later than 2025, will focus on four products:
- term insurance,
- critical illness cover,
- income protection,
- whole life insurance.
Pure protection insurance policies are designed to provide financial assistance to beneficiaries if the insured is unable to meet their financial commitments.