FCA calls for action to close life insurance protection gap
Half of British adults go without life cover, leaving families vulnerable.
The Financial Conduct Authority's review of how pure protection products are sold has put a spotlight on a troubling gap: 58% of UK adults don't hold any life insurance, and of those who don't, 59% have never considered whether they need cover.
The FCA reckons the main culprit is lack of awareness. Most people simply don't think about what would happen to their family's finances if they died. There's also the issue of price and access: some potential customers, particularly those with existing medical conditions, struggle to find or afford cover.
The regulator's interim market study, published earlier this year, found that insurance companies generally do a decent job once someone has decided to buy cover. But the distribution gap is real: many people who would benefit from protection never come into contact with a policy in the first place.
The FCA aims to close this gap. Their final report, expected in Q3 2026, will set out solutions aimed at widening access and prompting more people to think about their protection needs. That could mean more people exploring term assurance, income protection, or critical illness cover.
Based on the FCA's pure protection market study (July 2026). Information only, not advice.
Information only. This is general information, not financial, tax or legal advice, and not a personal recommendation. Tax rules depend on your individual circumstances and can change. Please speak to a qualified, FCA-regulated adviser or a solicitor before acting.