Why Essential Illness IP?
160,000 people a year no longer buy Income Protection, Essential Illness IP isn’t a policy designed to be sold ‘instead of’ traditional IP but a policy that some of those 160,000 consumers can accept works for them and their perception of risk.
Consumers just don’t believe in the risks as we do anymore (We being the industry). We can continue to tell them what they need, ignore what they think or the way the world has changed and watch as the IP market sits at 40% of what it was 15 years ago, or we can do something different and reach out to those disaffected consumers as Holloway Friendly first did in 1880.
Essential Illness IP is that different policy that has been developed with medical and social changes mind:
There have been significant advancements in medicine over the last 30 years which has not only changed admission and recovery times but has changed the perception of risk in some consumers to a level where traditional IP no longer serves their concerns.
- Mental Illness is much better understood and dealt with by medical professions, that’s not to say that more can’t be done. The most common time of onset for Clinical Depression is between 20-30 and for illness such as Bi-Polar disorder it is earlier at 18-25. Diagnosis of these is below the average age for IP application, being mid 30’s, so consumers would be declined or conditions excluded even if they bothered to apply.
- Stress is a situational illness, which is why it can be referred as Situation Depression, remove the stress factor and the majority of people will recover quickly and never suffer a re-occurrence. Consumers no longer relate this to being a long term risk.
- Significant numbers of proceedures are now conducted as out patient, recovery times have reduced and the length of stay for admitted care (excluding day cases) has fallen from just below eight to just over five days over a ten year period 2003-2013; and median length of stay fell from two days to one day in 2007/08, and has remained constant since. The most common length of stay for admitted care is now one day.
- In the last 10 years alone the admission time for Total Knee Replacement has fallen from 13 days to 5.
- With those changes significant numbers of the 160,000 are likely to have pre diagnosed conditions that would not be able to obtain cover at all or with loadings making the cost prohibitive, either from an absolute ‘can’t afford it’ or perception ‘it’s not worth it’ PoV.
Not being able to commute and sit behind a desk is no longer a barrier to working, having a broken arm/leg or bad back doesn’t stop people from dealing with their core roles from their sofa and more and more employers are happy for their staff to do this rather than lose their most valuable asset.
- 44% of ‘office’ based workers reported working from home when off sick.
- The majority of emails are now opened on a mobile device
- The internet is more widely accessed via mobile device than desk top.
- Late GenX and early GenY members are more likely than previous generations to job hop, leading to less dependence on employment for security and less concern about time away from work.