Protection insurance gap leaves 58 percent of adults uncovered
Around 58 percent of adults lack life, critical illness or income protection, prompting the Financial Conduct Authority (FCA) to launch a joint campaign with industry partners. The cross-sector effort targets underserved groups including renters, the self-employed and low earners.
Nudges at key life milestones
Survey data shows that 59 percent of the unprotected population has never considered purchasing protection cover, leaving millions vulnerable to income loss or illness.
To address the deficit, the FCA is coordinating actions across several industry bodies.
The Money and Pensions Service and the Digital Property Market Steering Group will prompt consumers at life events such as home purchases or parenthood.
Meanwhile, the Protection Distributors' Group will lead a targeted awareness campaign, and the Association of Mortgage Intermediaries will train advisers.
The FCA will also host an industry webinar, work with the Association of British Insurers on medical records, and open a TechSprint with interest due by November 13, 2026.
Consumer Duty over market-wide rules
The drive builds on findings from the FCA's Pure Protection Market Study, which examined switching, claims handling and fair value.
Graeme Reynolds, director of competition at the FCA, noted: “Competition in protection insurance works well for existing customers. But we're working with partners to increase coverage – so that more people are protected when they or their families need it most.”
While the regulator plans no market-wide rules, it reminded firms of their Consumer Duty obligations.
Nudges cannot fix affordability
Soft nudges and voluntary industry pacts avoid regulatory friction but ignore core affordability hurdles.
Property milestone prompts benefit conventional homebuyers while offering little help to precarious gig workers.
Awareness drives alone cannot close a structural coverage deficit without cheaper, simpler products.