Protection Premiership 2000-2020
- Term 2020. The market in 2020.
- Term 2000, 2010, 2020. The top 5.
- Critical Illness. The top 5.
- Term 2025. Who will be top 5 in 2025?
- Income Protection. Not yet written.
- Whole Life. Not yet written.
This article examines volumes and market shares for the term market (life cover and critical illness cover) for the years 2000-2020, paying particular attention to the movements in 2020.
At the outset I would like to acknowledge and thank Ron Wheatcroft of Swiss Re for fielding a number of data queries. Any errors made and views expressed in this post are my own.
Sales and market share of the top 5
Market volume and top 5 share:
Source: TermWatch 2001-2021
Key features:
- The term market peaked in 2003.
- Policy sales have been largely static over the last c15 years.
- The top 5 market share rose sharply over 2009-2011…
- … but has declined a little since.
Splitting the top 5
We now include 5 new lines, showing the market share for each of positions 1-5:
Source: TermWatch 2001-2021
Market shares for positions 2-4 almost converged in 2020, illustrated by their overlapping labels. The numbers behind the graph showed the biggest lead of 1st over 2nd position was in 2015 (20.6%) followed by 2020 (19.5%). The 4th-5th gap is also at a record high.
Gaps in the top 5
Let’s look at those gaps before 2020:
Source: TermWatch 2001-2021
In 2020:
- The gap from 1st (L&G) to 2nd (Royal London) is almost at a record high.
- Similar the gap from 4th (AIG) to 5th (Zurich) is at a record high.
- But between there is bunching: the gap from 2nd to 4th is at a record low.
Sales and market shares for 2020
The numbers behind the 2020 part of the graphs are as follows:
| # | Company | Policies | Market share |
|---|---|---|---|
| 1 | Legal & General | 504,061 | 31.7% |
| 2 | Royal London | 194,785 | 12.3% |
| 3 | Aviva | 182,931 | 11.5% |
| 4 | AIG | 182,013 | 11.5% |
| 5 | Zurich | 101,946 | 6.4% |
Source: TermWatch 2021
Over 2000-2020 the top position was taken by either Aviva (3 times from 2000-2002) or L&G (18 times from 2003-2020). That won’t change soon. Why is L&G so successful?
The real tension is in positions 2-4: in 2020 Aviva, having fallen to 3rd for the first time, was less than 1000 policies ahead of AIG. What happens next?
The 2020 top 5: market shares 2017-2020
For 2017-2020, inclusive, the top 5 positions have been taken by the same insurers. L&G has always been top, Zurich always 5th, with a little movement in 2-4.
Over 2017-2020 the top 5’s share reduced from 77.7% to 73.4%. In that context:
- Aviva’s share has declined, almost halving over the period.
- AIG grew strongly in the first two years, but has stabilized.
- Royal London’s share was slowly declining, but saw a big rise in 2020.
- Zurich has been stable throughout.
- L&G’s share had declined slightly from a high base, but went back up in 2020.
Where next?
My aspiration is to extend this post, giving:
- Separate coverage of critical illness, income protection and whole of life.
- Views on previously influential protection insurers e.g. Scottish Provident and Bright Grey.
- The drivers of protection success
- Speculation for the period 2021-2030.
I’ve always had a talent for intentions!