The COVID-19 pandemic and resulting economic slowdown gave the UK protection market an unexpected boost. Annual sales of term insurance peaked at 1.71 million in 2021, up from 1.64 million in 2019. However, the industry has been unable to build on this growth, and sales have fallen in each of the past three years. While factors such as the higher cost of living and a downturn in the mortgage market have hit demand, shrinking supply has also played a part.
Conditions will remain challenging in the short term. Despite recent cuts in the bank base rate, elevated house prices and above-target inflation continue to stretch mortgage affordability and household finances, respectively. Consequently, we anticipate sales volumes stabilising in 2025 before a gradual recovery in new business from 2026 onwards.
Over the longer term, prospects for the market are reasonably positive, with opportunities to expand take-up through the delivery of simplified and flexible solutions, which will appeal to a broad base. There remains good scope to widen the product’s appeal beyond mortgage holders, and significantly grow take-up among parents who rent their homes.
This report looks at the following areas:
- Five-year forecast of the individual term assurance market, by volume sales and value of premiums.
- Key provider market share, competitive strategies and innovation.
- Ownership of life insurance and protection products, by demographic.
- Policyholder motivation, beneficial direction, and product engagement and commitment.
- Barriers to purchase and likelihood of non-policyholders getting cover in the future.
There is scope to boost take-up among uninsured parents, especially those who rent, using social media and digital marketing to inform them of the benefits.
Sarah Hitchcock, Associate Consultant – Financial Services
Collapse All
-
EXECUTIVE SUMMARY
- Opportunities for the term assurance market
- Alleviate customer concerns over AI
- Packaging life cover with a media subscription service will increase appeal
- Promote shorter, flexible terms to attract latecomers
- Market dynamics and outlook
- Market size & forecast
- Market predictions
- Steady growth in annual new sales expected over the next five years
- Aviva moves ahead of Legal & General to claim top spot
- Graph 1: share of new term assurance business (% of volume sales), 2024
- Demand for life insurance is heavily linked to housing and mortgage activity
- What consumers want and why
- Families with children are twice as likely to have life cover than those without children
- Most people take out life insurance to cover living costs should the worst happen
- Lack of affordability is the top reason for having no life cover
- Graph 2: top six reasons for not having life insurance, 2025
- Significant latent demand exists among uninsured parents
- Families with children face greater financial pressures, putting them at greater risk of cancellation
- Around half of all customers are comfortable with digital-only and AI-enabled services
- Graph 3: select attitudes towards life insurance, digital technology and AI, by those with children and those without, 2025
-
MARKET DYNAMICS
- Market size
- Over 10 million policies in force
- Annual sales of term insurance have fallen since the pandemic
- Graph 4: volume of new term insurance sales, 2019-24
- Premium income has also declined
- Graph 5: value of new term life insurance premiums, 2019-24
- The market is on course to stabilise in 2025
- Market forecast
- Volume of new sales will increase gradually over the forecast period
- Total new premiums will rise very slowly
- Prospects for new business start to improve
- Market segmentation
- Non-mortgage linked term sales continue to languish
- Graph 6: volume of new term life insurance sales, by type, 2019-25
- Inflation pushes up the cost of cover
- Graph 7: average new term life insurance premium, by type, 2019-25
- Mortgage term policyholders pay higher premiums, on average, than other term policyholders
- Mortgage term customers are less likely to take out a CI rider than in the past
- Graph 8: critical illness rider cross-sell rate, by type of term policy, 2015-24
- Channels to market
- Most term life insurance applicants take advice
- Graph 9: share of new other term life sales, by channel, 2024
- Graph 10: share of new mortgage term life sales, by channel, 2024
- Intermediaries generate the lion’s share of sales
- Scope to expand direct business
- Claims experience
- The pandemic caused a big jump in claims costs
- Graph 11: value of term life insurance claims paid and value of new sales, 2019-24
- 4% of new claims are rejected, mainly due to non-disclosure
- Market share
- Aviva’s acquisition of AIG boosts sales volumes by 50%
- Top five control nearly three quarters of the market
- Significant others
- Market drivers
- Uplift in mortgage transactions helps to revive the mortgage term sector
- Graph 12: number of mortgage versus property transactions, 2019-25
- Hopes of further interest rate cuts fade due to persistently high inflation
- Rebound in first-time buyer market fails to revive term life sales
- Rising house prices push up average sums insured
- Graph 13: term assurance average sum insured, by type of policy, 2020-24
- Renters represent a future growth area
- Regulatory environment
- FCA’s pure protection review highlights the importance of ensuring fair value
-
WHAT CONSUMERS WANT AND WHY
- Life insurance ownership
- Most UK adults lack life cover
- Graph 14: ownership of life insurance and other protection products, 2025
- Take-up of life insurance is greatest among parents and homeowners
- The private rental market remains ripe for expansion
- Cross-sell opportunities abound
- Graph 15: segmentation of adult population by life protection coverage, 2025
- Still more to be done to educate and inform consumers
- Lives covered and beneficiary direction
- It’s not uncommon for cohabiting couples to own single life cover
- Graph 16: single and joint life term assurance coverage, by relationship status, 2025
- Regularly remind customers of the importance of naming beneficiaries
- Graph 17: beneficial direction made by policyholders, 2025
- Almost one in three policyholders have written their policy in trust
- Motivation for having life insurance
- Clearing a mortgage is often not the primary purpose of cover
- Graph 18: intended use(s) for term life insurance payout, 2025
- Motivations vary depending on whether or not customers have children
- Graph 19: intended use(s) of any term life insurance payout, by those with and without children, 2025
- Parents are keener to cover general living expenses than a mortgage
- Policyholder attitudes and understanding
- Regular communication with customers can improve understanding
- Graph 20: whether or not policyholders are confident of understanding the terms of their life insurance policy, 2025
- Nearly half of all term policyholders have considered cancelling cover
- Graph 21: whether or not considered cancelling life insurance policy due to the higher cost of living, 2025
- The vast majority of customers think life insurance is essential
- Graph 22: agreement with statements about life insurance, 2025
- A fifth of policyholders lack trust in their insurer to settle claims fairly
- Increased engagement and understanding leads to a greater level of trust
- Younger customers are more likely to embrace digital-only and AI-enabled services
- Interest in getting cover and barriers to purchase
- Nearly a third of uninsured adults are open to getting life cover in the future
- Graph 23: likelihood of buying life insurance in the future, % of uninsured adults, 2025
- Good expansion potential
- Lack of perceived affordability, relevance and awareness are the main barriers
- Graph 24: reasons for not having life insurance, 2025
- Parents face different barriers to those without children
- Graph 25: reason for not having life insurance, by those with children and those without, 2025
- Education is key to boosting take-up
-
INNOVATION AND MARKETING TRENDS
- Competitive environment
- Competition declines as supply shrinks
- Bluezone rebrands as Blueberry Life and expands offering
- AIG Life rebrands to Aviva Protection UK and establishes a new partnership with Tesco
- Launch activity and digital developments
- AI is the new driving force behind the digital revolution transforming the insurance industry
- Aviva’s new collaboration with NatWest  embeds life quotes in the digital mortgage application process
- Royal London enhances digital services to improve customer access to protection policies
- Clark’s Polly brand offers UK’s first fully digital underwriting solution
- Advertising and marketing activity
- Vitality was the leading advertiser of life insurance in 2024
- Graph 26: advertising expenditure on life insurance products, 2021-24
- Social media forms a major part of Clark UK’s marketing strategy
- Vitality claims its life insurance can help people live longer
-
APPENDIX
- Supplementary data
- Market segmentation – mortgage term
- Market segmentation – other term
- Market segmentation – critical illness riders
- Claims data
- Advertising expenditure by media type
- Advertising expenditure by top ten advertisers
- Market forecast data and methodology
- Market forecast: volume of new business
- Market forecast and prediction intervals (volume)
- Market forecast: value of new business
- Market forecast and prediction intervals (value)
- Forecast methodology
- Report scope and definitions
- Product definitions
- Other related products
- Sources used in the report
- Abbreviations and terms
- Consumer research methodology
- Nielsen Ad Intel coverage
Mintel: Market Intelligence Made Easier
The first Mintel Market Intelligence report was published over 50 years ago. Since then, we have provided our unique insights and understanding of consumers, innovation and global markets to thousands of customers worldwide. Here’s why our customers rely on Mintel:
- Gain a comprehensive, 360-degree view of the market: Mintel reports blend consumer research, market forecasts, product innovation tracking, and competitive analysis, allowing businesses to see every angle of their industry and identify new opportunities quickly.
- Make decisions with confidence, grounded in robust data: Each report draws on up-to-date, reliable information from trusted sources and industry experts, ensuring your strategies are based on solid evidence rather than speculation.
- Benefit from expert analysis and practical recommendations: Mintel’s reports are written by experienced analysts who interpret complex data and provide clear, actionable insights you can trust to guide your next moves.
- Stay ahead with actionable intelligence on market trends and consumer behaviour: By combining fresh research with long-term market monitoring, our reports help businesses anticipate changes and adapt strategically. So you’re prepared to make informed decisions and drive growth.
What goes into a Mintel Market Intelligence Report?
Curious about how a Market Intelligence report comes together? We like to think of it as building a detailed puzzle. We start with individual pieces: data from consumers, market statistics, industry trends, and online conversations. Then our expert analysts add world-class human insight and industry knowledge. The pieces are assembled to reveal a clear, comprehensive picture of a market.
The Four Pillars of Our Research
We use a combination of four main research methods when creating our reports, each adding a valuable perspective:
- Consumer Research: Direct surveys with real people, giving us clear, current insights into what people think and do.
- Desk Research: In-depth review of trusted data sources. We use this rich database, plus powerful internal tools that track new products and market sizes, to detect trends and guide forecasts.
- Trade Research: Insights from conversations with industry experts. Their real-world experience helps us understand what’s happening behind the scenes.
- Brand and Social Media Research: Analysis of online opinions and trends. This lets us spot trends, measure brand sentiment, and capture feedback in real time, adding further depth to our research.
For further information about our research and analysis methods, visit our helpdesk.
Bringing It All Together
Each of these four pillars provides a different piece of the puzzle. Consumer research tells us what customers think, desk research provides the factual framework, trade research offers an insider’s view, and social media analysis reveals public sentiment.
Our expert analysts are skilled in weaving these diverse data streams together. They apply a range of quantitative and qualitative analysis techniques to uncover the deeper story, connecting the dots to deliver clear, actionable insights. This comprehensive, multi-layered process is how we transform raw data into a market intelligence report you can trust to inform your most important business decisions.
For a closer look at a Mintel Market Intelligence Report, take a look at the sample PDF report below:
Please Note: All of the figures, graphs, and tables in this sample report have been redacted.
£ 2,195 (Excl.Tax)
-
Download today with instant access
Pay via credit card or purchase order
-
Multiple formats provided
We send a PDF, Powerpoint and Excel Databook straight to your inbox. An interactive version of the report is also available on our online platform
-
Interactive databook included
Focus on the data that matters most to you with a customisable databook avaliable on our platform
-
Save up to 20% when you purchase multiple reports
Discount is applied directly at checkout
Next Starts Here
Whatever your business needs, we have the solution. From market intelligence reports to customised growth strategies.
Learn moreTrusted by global industry leaders
Working in a customer-obsessed organization means that data and insights have to be at our fingertips. Mintel’s reports help us support anecdotes with real quantifiable insights. The summary sections (which I really like) helps save time by giving a birds eye view of the content before spending time combing through the pages.
Our business review discussions are strengthened by the relevancy of the reports to help us better understand our customers. In addition, the customer service received from the team (especially in crunch periods) makes the process of understanding customer behavior even better.
Ngozi Ngonadi-Nkwoji, Senior Marketing Manager, Amazon
We use Mintel to inform our thinking and reinforce strategy. If you’re presenting new ideas, it’s essential they are underpinned by robust data and evidence, and clearly rooted in fact.
Mintel gives us all that. It’s a great brand and one that is trusted by clients.
Marie Stafford, European Director, The Innovation Group, VML
We have such a great working relationship with Mintel on lots of different levels. As an insight partner, they have helped us to develop our business planning in specific categories as well as supporting our creative process but they’ve also been super helpful with facilitating our events in their inspirational offices near St Paul’s.
They’re an innovative company, with a client-focused team that always delivers.
Abby Carvosso, Group Managing Director, Bauer Media Group
We’ve found it so useful working more closely with Mintel. They helped support our recent flagship event for our top suppliers by providing a really unique viewpoint on the future of online retailing.
Nick Carroll from their Retail Team was also an excellent panelist, sharing useful and actionable consumer insights. We definitely look forward to working with Mintel again on future projects.
Zac Steele, E-Commerce Trading Development Manager, Waitrose & Partners
We utilize Mintel Reports, Trends and Comperemedia to mine for insights across the numerous business verticals that Epsilon serves, such as CPG, automotive, telecom, healthcare/pharma, retail and financial services.
By integrating Mintel insight into new business opportunities, we have been able to gain the competitive edge necessary to advance partnerships with global brands and key business players.
For our organization, it’s about depth and breadth. Having one without the other doesn’t enable success in our business.
Virginia Harvey, Secondary Research Manager, Epsilon
Next Starts Here
Whatever your business needs, we have the solution. From market intelligence reports to customised growth strategies.
Learn more
