Income protection was the hardest hit with a 30% year on year decrease according to the quarterly protection business statistics from iPipeline. However, the platform noted that they saw an uptick in sales in June.
Wealth Independent Financial Advisers saw a 16% decrease in protection sales processed with General IFAs seeing an 8% decrease.
The average protection premium was down 7% year on year.
Ian Teague, UK group managing director at iPipeline said: “The protection industry was riding high going into 2020, so it came as a real shock when the full extent of COVID-19 became clear and the consequences of the pandemic began impacting sales. Unsurprisingly, considering the freeze in the mortgage market, mortgage brokers have been worst affected. Research has identified that people want and need protection more than ever and our industry has an important role in having more protection conversations and helping them meet their financial resilience goals.
“We anticipate market-wide protection volumes returning closer to pre-pandemic levels as mortgage broking and IFA businesses increase capacity. We believe that we will see growth in the protection market as our industry meets the UK population’s increased demand for improved financial resilience, though this could be dampened should economic headwinds or further lockdowns really bite in Q4.”