Dallas, TX: ReportsandReports announce Japanese UK Private Medical Insurance 2010 Market Research Report in its Store.

Browse complete UK Medical Insurance Market Report

This report gives a comprehensive analysis of the UK private medical insurance sector. An exclusive survey provides insight into customer trends and attitudes towards private medical insurance. The report also assesses the current market issues including a detailed look into innovations taking place and how insurers are responding to the changing customer needs throughout these testing times.

Scope

• Detailed consumer research into individual trends, attitudes and future buyer interest.
• New market innovations taking place and how providers are adjusting their propositions.
• Data on the market share of the top groups as well as an analysis of the market spend of the top brands.
• Forecasts for the market size and subscriber numbers split by individual and group business.

Highlights

As with previous recessions, the most recent downturn appears to have taken its toll on the PMI market. The most recent recession, which began in the second half of 2008, caused a 5% fall in both individual and group subscribers during 2009.

The average premium rates for both group and individual policies continued to grow, by 2.2% and 7.2%, respectively. Rising premium rates have been an important cause for the decline in subscribers in the individual PMI sector in recent years, with potential policyholders put off by these increases.

Average premium rates for both individual and group policies are forecast to continue to rise. This increase will primarily be driven by claims inflation, which means that insurers need to increase their premium rates in order to maintain the same level of margin.

Reasons to Purchase

• Make informed decisions based on a solid understanding of customer attitudes and purchasing trends.
• Understand which of your competitors pose the greatest threat and which competitors are gaining or losing market share.
• Gain insight into the future direction of the sector, including market size and subscriber numbers and the major issues affecting this market.

Table Of Contents

Overview

Catalyst

Summary

Executive Summary

The group PMI market suffered significantly in 2009

Group PMI’s sensitivity to the wider economic climate was evident

Price inflation is a challenge for retaining individual PMI subscribers

Competition is high within the group sector, while employers are scaling back their PMI budget

Individual and group subscribers are falling

Individual and group PMI subscribers shrunk by 5% in 2009

The total number of people covered by PMI decreased by 4.6%

Product innovation will ensure the future survival of PMI

Cancer cash plans and hybrid policies are growing in popularity

Chartis entered the market with a £1m advertising campaign

Chartis spent £1m on marketing its new health insurance proposition

Total PMI GEP will continue to grow throughout the forecasting period

The PMI market is expected to grow in 2010

The group PMI market will continue to grow throughout the forecasting period

Table of Contents

Table of figures

Table of tables

Market Context

Introduction

PMI insurers have had a turbulent year as a result of the downturn

The recession appears to have taken its toll on the PMI market

The group PMI market suffered significantly in 2009

Group PMI’s sensitivity to the wider economic climate was evident

Price inflation is a challenge for retaining individual PMI subscribers

Competition is high within the group sector, while employers are scaling back their PMI budget

Competitive but realistic pricing within the group sector is crucial

UK PMI group business declined by 3% in gross earned premiums

Individual and group subscribers are falling

Individual and group PMI subscribers shrunk by 5% in 2009

The total number of people covered by PMI decreased by 4.6%

Rising claims costs are forcing price increases in order to maintain profits

The increase in group PMI premium rates was below the rate of claims inflation

Insurers are focusing on controlling medical cost inflation

Medical costs are shooting up every year

Insurers have adopted many ways to manage medical inflation

There are three main ways to lower claims costs

Insurers can also try to get a better deal by using hospital networks and managed care

Shared responsibility for claims bills could help manage costs

Attracting new customers via lower premium prices can be achieved by a variety of means

Healthy lifestyle options and targeted benefits can lower PMI rates

Modular policies are designed for customers seeking different levels of cover

Most of the big insurers offer online discounts to entice new customers

Market sentiment is that the NHS funding gap may prompt interest in alternative healthcare options

Market sentiment is that the 1% increase in IPT will not significantly affect PMI uptake

Only 15% of the adult population have a PMI policy

Providers should look to tap all age groups

High earners are the core market for PMI providers

PMI penetration is highest among customers in the A and B socioeconomic bands

25-35 year olds account for the majority of group PMI business

Product innovation will ensure the future survival of PMI

Cancer cash plans and hybrid policies are growing in popularity

Cash plans are becoming an appealing alternative to PMI

Marketing and Distribution

Introduction

Chartis entered the market with a £1m advertising campaign

Chartis spent £1m on marketing its new health insurance proposition

Most providers are using one of two clear media strategies

Simplyhealth is making a big push through advertising in 2010

Simplyhealth now includes the HSA, BCWA, LHF, HealthSure and Totally Active brands

Simplyhealth is successfully building brand awareness in the market

Aggregators are increasing their presence in the PMI market

PMIPartners introduced is new individual PMI aggregator website

MoneySupermarket.com also began comparing PMI policies over the past year

Most individual PMI policies are sold direct

PMI policies are predominantly arranged via an employer or direct with an insurer

A direct strategy is key to winning customers aged over 60

Interest in buying PMI declines with age

Consumers in the mid and upper income bands are the core market for PMI

Competitive Dynamics

Introduction

Bupa, PruHealth and Munich Re gained market share in 2009

Bupa’s market share increased by 0.3 percentage points to 44.7% in 2009

PruHealth’s business grew by over 18%

Munich Re’s market share grew by one percentage point

BUPA, AXA, Aviva, Standard Life and WPA remain the top five competitors

BUPA, AXA and Aviva controlled 81.2% of the market in 2009

Standard Life is the fourth largest PMI provider in the UK

All of the top 10 PMI insurers have a presence in the individual market

National Friendly and Chartis have a different PMI proposition from the mainstream

National Friendly’s PMI proposition combines PMI with cash plan benefits and a deposit account

Individual comprehensive medical cover for adults starts from just £40 per person

The business proposition also includes dental and optical treatments

Chartis Direct’s Health Choice offers a competitive premium rate

Aviva has led the way for innovation through its cheaper and more flexible product range

Aviva’s Healthier Solutions offers higher flexibility

Speedy Diagnostics is another example of a new low-cost PMI policy

Future Decoded

Introduction

Recovery in the PMI market will depend on the health of the economy

The base scenario assumes a slow but steady recovery in the UK economy

Total PMI GEP will continue to grow throughout the forecasting period

The PMI market is expected to grow in 2010

The group sector is expected to see higher growth than the individual market

The group PMI market will continue to grow throughout the forecasting period

The growth of the individual PMI market will still depend on premium prices

Subscriber numbers will fall for individual but increase for group

Premium rates are expected to increase throughout the forecast period

The number of individual subscribers is expected to fall throughout the forecast period

The number of group subscribers is expected to remain static in 2010 and resume growth from 2011

Appendix

Definitions

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

Browse complete UK Medical Insurance Market Report

Browse all Banking and Financial Market

Browse all Datamonitor Market Research Reports

Browse all Latest Reports

Related Reports:

UK Private Motor Insurance 2010

UK Private Medical Insurance 2009

UK Commercial Insurance Distribution 2010

About Us:
Reports and Reports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.

Contact:
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Tel: +1-888-989-8004
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Dallas, TX: ReportsandReports announce Japanese UK Personal Insurance Distribution 2010 Market Research Report in its Store.

Browse complete UK Insurance Market Report

This report provides an analysis of the distribution of personal insurance in the UK. It includes information on the advertising spend and market share of the key players and analyzes the effect of online aggregators in the personal lines sector. It also details notable deals made over the past year and explores the evolving balance between the various distribution channels.

Scope

• Insight into the latest issues affecting the personal insurance market and the impact these are having on distribution.
• Data on consumer purchasing behavior and brand loyalty in the UK household and private motor insurance markets, sorted by key demographic groups.
• The latest data on the size of the personal insurance market and premium splits by distribution channel.
• Forecasts up to 2014 of the market share of different channels in the UK private insurance space.

Highlights

As of March 2010, the internet was the most popular platform for arranging motor insurance overall, with more than half of all respondents stating that they had used the platform. This highlights consumers’ confidence in arranging the policies and other financial transactions online without assistance.

Overall, the top 10 insurance advertisers spent 1.1% less on advertising in 2008 compared to 2007, dipping from £216.4m overall to £214.0m. This was perhaps indicative of the effect the economic recession had on the insurance sector as a whole, rather than due to a specific trend.

Carole Nash insures 300,000 motorcycles, which equates to about a quarter of all licensed bikes in the UK. Since acquiring more than 17,000 policies from the AA in 2004, Carole Nash has been purchasing motorcycle books from those who do not consider them a core product.

Reasons to Purchase

• Understand consumer purchasing patterns and their attitudes to brand awareness and aggregators.
• Make decisions based on consumers’ use of different platforms for personal insurance arrangement and the shifting trends within the market.
• Gain insight into the factors driving changes in distribution and how this is linked to modern technology.

Table of Contents

Overview

Catalyst

Summary

Executive Summary

The direct channel gained market share, while brokers saw their share decline

The direct channel remains the dominant provider of private motor insurance

Banks and building societies hold the largest share of the UK home insurance market

The top 10 advertisers increased their expenditure compared to 2008

The vast majority of consumers use the internet or telephone to arrange their motor insurance cover

Half of all consumers arrange their motor insurance over the internet

Consumers aged between 25 and 34 are more likely to arrange their motor insurance online

The broker channel has been gradually growing its household insurance market share

Brokers distributed an estimated 28% of the private motor insurance GWP in 2009

Brokers hold a growing share of the home insurance market

Banks and building societies lost personal insurance market share in 2009

Bancassurers hold the largest share of the UK household insurance market

The presence of affinities has decreased in the UK home and motor insurance markets

Affinity groups and retailers saw a slight dip in their private motor market share from 2008

Fortis procures significant partnerships to provide Tesco and Toyota with home and motor insurance

Over 60% of consumers use an aggregator when purchasing motor insurance

A sizeable proportion of aggregator visitors use them for research purposes only

Table of Contents

Table of figures

Table of tables

Personal Insurance Distribution Dynamics

Introduction

The direct channel gained market share, while brokers saw their share decline

The direct channel remains the dominant provider of private motor insurance

The broker channel is the second largest distributor of private motor insurance

Corporate partnerships witnessed their share contract in the private motor market

The banks and building societies market share is diminishing

Banks and building societies hold the largest share of the UK home insurance market

The majority of home cover sales can be attributed to banks and building societies

Brokers closed the market share gap with the bancassurers in 2008 and 2009

The direct channel retains a level share of the household insurance market

Partnerships share of the UK home insurance market has declined

The vast majority of home and motor insurance policies are distributed through the top 10 groups and brands

Thirteen of the largest insurance groups hold the majority of both the home and motor insurance markets

Direct Line is particularly popular among younger consumers for private motor insurance

Older consumers are more likely to select a home insurance policy targeted at their age group

Direct Line’s and Halifax’s combined contents and buildings insurance policies are particular popular among younger consumers

Home contents insurance providers showed little age to market correlation, aside from RIAS and Saga

Consumers aged 18-24 were most likely to arrange buildings only home insurance policies through a top ten distributor

Two aggregators appeared in the top 10 advertisers in 2009

The top 10 advertisers increased their expenditure compared to 2008

RBS brands Direct Line and Churchill were two of the top three insurance advertisers in 2009

Zurich Insurance became a top 10 advertising spender after more than doubling its advertising spending in 2009

Acromas Group insurers decreased their advertising spend in 2009

Aviva resumes its high advertising spend from 2007

The top insurance advertisers spent half their budgets on television advertising in 2009

While TV advertising remains the medium eliciting the most expenditure, direct mail has increased in prominence as an advertising platform

Saga and HomeServe spent the most on direct mail advertising

Press, radio and the internet were used to a lesser extent in insurance advertising

Personal Insurance Consumers

Introduction

Home and motor insurance remain the largest potential pools of customers for personal lines insurers

The sizable market for private motor insurance included a larger and more even penetration spread than in 2008

Middle-aged and older consumers are more likely to have motor cover, perhaps necessitating a more universal strategic focus than before

Motor insurance consumers with higher incomes have higher penetration rates

The social grade of consumers has less bearing on the likelihood of arranging motor insurance

Combined household insurance is the most popular type of product sold to consumers

There is a healthy market for home insurance products

Consumers over the age of 55 are the largest target market for combined policies

Higher income households have higher penetration rates for combined home insurance and buildings only cover

Consumers belonging to socio-economic groups A and B display consistently higher penetration rates for combined household products

The vast majority of consumers use the internet or telephone to arrange their motor insurance cover

Half of all consumers arrange their motor insurance over the internet

Internet and telephone sales are becoming increasingly prevalent in the home insurance market

Internet sales strategies would prove more effective than telephone sales for younger personal insurance policy buyers

Consumers aged between 25 and 34 are more likely to arrange their motor insurance online

The telephone surpasses the internet as the most popular platform for arranging home contents insurance

Consumers aged over 64 prefer to use the phone to arrange their insurance policies, whereas other groups prefer to use the internet

Internet-based sales strategies are effective at targeting higher income households

To a point, higher income consumers are more comfortable purchasing their motor insurance cover online

Internet selling strategies for combined home insurance should remain the core method of targeting consumers with household incomes over £30,000

Consumers are generally more likely to purchase their home contents insurance over the telephone

The internet was the most popular method of motor insurance arrangement

Consumers belonging to socio-economic group E displayed the lowest tendency to purchase their motor insurance online

A and E consumers prefer to purchase their combined policy over the telephone

The telephone is the preferred platform for arranging home contents insurance policies

Insurance providers’ retention rates vary with age and type of insurance

Older consumers are generally more likely to stay with their existing insurance company

Consumers aged under 34 displayed the least loyalty to their insurance providers

Consumers aged 45-64 are more likely to stay with the same home contents insurance provider at renewal

Retention rates for combined home insurance peak with middle-aged consumers

Wealthier consumers are the least loyal to their home insurance providers

Motor insurance consumers displayed a similar level of switching among all income bands

Consumers earning less than £15,000 are least likely to change their combined insurance provider

Consumers with a household income of £75,000-99,999 are the most loyal to their home contents insurance policy providers

Price should be the primary focus in insurance marketing campaigns

Price was the most commonly cited reason for selecting a motor insurance provider

Insurance companies should emphasize competitive prices when marketing their combined policies

While price remains the dominant attraction for insurance buyers, older consumers are more likely to consider other factors

Although it remains the key factor, older consumers of motor insurance are less concerned about price

Older consumers increasingly value non-price factors when choosing their home insurance providers

Direct Insurance

Introduction

Direct insurers have a growing share of the private motor market

Direct insurers have experienced an increase in their market share in private motor cover since 2006

Direct insurers hold a level share of the household market

The top direct insurers significantly increased their overall advertising budget

Advertising spend on motor and travel insurance decreased, while expenditure on other forms of general insurance increased by varying amounts

All forms of media advertising saw increased direct insurer funding, apart from cinema campaigns

Direct Line remained the top direct insurance advertiser in 2009, albeit by a smaller margin

Direct Line still dominates most areas of motor and home insurance

The top five direct insurers comprised over a quarter of the motor insurance market

Direct insurers consistently form the top five players in the home insurance market

Direct insurers continued to launch new products in a bid to their grow market share

AXA launched a new direct motor cover product

Zurich launched its new Zurich Connect product

Fortis will rebrand itself to Ageas

RBS Insurance is to sell Direct Line and Churchill within a few years

esure has undergone a management buy-out from the Lloyds Banking Group

Brokers and Intermediaries

Introduction

The broker channel has been gradually growing its household insurance market share

Brokers distributed an estimated 28% of the private motor insurance GWP in 2009

Brokers hold a growing share of the home insurance market

The main focus of broker insurance advertising was via direct mail

The top 10 brokers allocated most of their advertising budget on private motor and home insurance marketing

Brokers continue to display a marketing strategy that is primarily focused around the direct mail platform

The AA cut its advertising spend, while RIAS significantly increased its budget

The AA dominated over other insurance brokers in both home and motor insurance

The AA was the market leader for broker-distributed private motor insurance

The broker household insurance market is dominated by AA, RIAS and Swinton

The broker sector has seen a number of big structural changes over the last year

LV Broker makes full use of its broking relationships

Brightside purchased eCar and eBike for up to £34.6m

Allianz Clear launches and incorporates a home insurance aggregator

Swinton increased its online sales effort

Castle Cover adds Zenith insurance to its panel

Carole Nash wins the Co-operative motorcycle book

Banks and Building Societies

Introduction

Banks and building societies lost personal insurance market share in 2009

Bancassurers held an estimated 5% share in the private motor market in 2009

Bancassurers hold the largest share of the UK household insurance market

Spending by the leading bancassurance advertisers decreased in 2009

Bank insurers more than tripled their spend on marketing their general/combined range, despite overall cuts to their budgets

In 2009, banks showed a slight swing toward a more contemporary mass-market advertising strategy

Half the top 10 bancassurers showed an increase in advertising budget in 2009

Banks hold a significant proportion of the home insurance market, but only have a small presence in motor insurance

Bancassurers have a diminished and negligible market presence in motor insurance

Lloyds Banking Group controls a significant share of the UK home insurance market

Barclays will continue to distribute Aviva home insurance

Despite decreased consumer confidence, bancassurers are still targeted by insurers as a means to growth

Barclays will continue to distribute Aviva home insurance

RSA will provide West Bromwich BS with household insurance policies

Affinity Groups and Retailers

Introduction

The presence of affinities has decreased in the UK home and motor insurance markets

Affinity groups and retailers saw a slight dip in their private motor market share from 2008

Affinities make up an estimated 15% of total UK household insurance GWP

The top affinity insurance advertisers increased their budget in 2009

A third of the insurance products advertised by the top 10 affinity insurance advertisers are niche lines

The top 10 affinity insurance advertisers use direct mail campaigns to effectively leverage their customer databases

While most of the top 10 affinity insurance advertisers decreased their advertising spend in 2009, their overall expenditure increased

Affinity partnerships comprise almost 10% of the general insurance market

The top five brandassurers hold a lower market share than in 2008

Affinity partnerships have the largest share in the combined policy market

A number of influential affinity partnerships were formed in the last year

Fortis procures significant partnerships to provide Tesco and Toyota with home and motor insurance

Kwik-Fit has sold off its insurance wing to Fortis

Carole Nash wins an insurance deal with Harley Davidson

Thornside to provide Sainsbury’s pet insurance

Heath Lambert wins Debenhams deal

Aggregators and Price Comparison Sites

Introduction

Over 60% of consumers use an aggregator when purchasing motor insurance

A sizeable proportion of aggregator visitors use them for research purposes only

Insurance aggregator advertising has become a four-horse race

Only negligible amounts were spent on aggregator advertising outside of the top four

More than three-quarters of the top four aggregators’ advertising budget was spent on motor insurance cover

The leading four aggregators are highly dependant on TV advertising

The aggregator market is innovative and highly competitive

MoneySupermarket.com’s revenue declined in 2009

MSN and BeatThatQuote.com have launched a new comparison site

Future Decoded

Introduction

The direct channel in the private motor insurance market is predicted to contract after 2011

The direct channel has shown consistent growth since 2007

Brokers are predicted to lose market share until 2011 and thereafter regain it

Affinity partnerships are forecast to gradually increase their market share over the next five years

As consumer confidence in the banking sector improves, bancassurers will gain market share in private motor insurance distribution

Banks and building societies are predicted to remain the dominant provider of UK household insurance

The direct channel is expected to see an increase in market share during the forecast period

Bancassurers are predicted to retain the largest share of the UK household insurance market

Brokers are expected to see a decline in market share from around 2011

Affinity partnerships will gradually increase their market share in UK household insurance

Appendix

Definitions

Premium income measures

Earned premiums

Gross premium

Net premium

Written premiums

Distribution definitions

Bancassurers

Banks/building societies

Brandassurers

Broker

Company staff

Direct channel

‘Other’ company agents

Partnerships

Methodology

Datamonitor General Insurance Consumer Survey

Primary and secondary research

Distribution estimates and forecast methodology

Advertising and marketing spend data

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

Browse complete UK Insurance Market Report

Browse all Banking and Financial Market

Browse all Datamonitor Market Research Reports

Browse all Latest Reports

Related Reports:

UK Personal Insurance Distribution 2009

Distribution in UK Personal General Insurance 2008

UK Commercial Insurance Distribution 2010

About Us:
Reports and Reports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.

Contact:
Ms. Sunita
7557 Rambler road,
Suite 727, Dallas, TX 75231
Tel: +1-888-989-8004
Source: Market Research
Blog: http://reportsnreports.wordpress.com/
Blog: http://reportsandreports.blogspot.com/

Dallas, TX: ReportsandReports announce Japanese UK Investment Bonds 2010 Market Research Report in its Store.

Browse complete UK Investment Bonds Market Report

Changes to the Capital Gains Tax regime have queried viability of the investment bond against a backdrop of financial markets emerging out of a recession. Providers are presented with a scenario for success if investors are made aware of clear circumstances where a bond is an advantageous investment.

Scope

• Examines the current shape of the investment bond industry and explore factors that are currently limiting new business.
• Analyzes the use of wrap platforms in the distribution of bonds with focus on how technological developments can enable better business.
• Reviews tax and regulatory changes that are challenging the investment bond market.
• Identifies key competitors and examines their differing strategies in the UK investment bond market.

Highlights

Despite changes to CGT, the investment bond is still a viable part of an investment portfolio. The smoothing factor of with-profits bonds offers the nervous investor the opportunity to even out the volatility of returns from the stock market and other underlying investments.

Economic uncertainty is a key challenge faced by the investment bond market, although a changing regulatory and tax environment continues to bring new challenges to providers, IFAs and retail clients alike.

Reasons to Purchase

• Gain unique insight into the tax and regulatory changes that are driving the investment bond market.
• Understand the investment bond market, the distribution trends and the key technological developments driving new business.
• Access Datamonitor’s forecasts for the market and valuable knowledge of how the sector is set to develop to 2014.

Table Of Contents

Overview

Catalyst

Summary

Executive Summary

The UK investment bond market declined at a CAGR of 15% over the past five years

Providers should make investors aware of clear circumstances in which a bond is an advantageous investment

Wrap platforms will shape the distribution of investment bonds

Table of Contents

Table of figures

Table of tables

Market Context

Introduction to investment bonds

Unit-linked bonds offer investors policies with a value that is directly linked to investment performance

Clients appreciate the flexibility and transparency of unit-linked bonds

With-profits bonds offer a smoothing mechanism, a unique attribute of the product

A distribution bond is recognized as a simple product that provides investors with a steady stream of income

Guaranteed bonds encompass the guaranteed income, guaranteed growth and guaranteed equity bonds

Guaranteed income and guaranteed growth bonds

Guaranteed equity bonds

Money market bonds are a new category of bonds introduced by the ABI in 2008

Sales of investment bonds in 2009 suffered at the hands of fallen stock markets

Unit-linked bonds immediately felt the positive effect of stock market rallies in 2009

The smoothing factor of with-profits bonds are attracting and calming the nervous investor, to generate healthy sales in 2009

With-profits bonds became unpopular after the stock market bubble burst in 2001

Guaranteed bonds were popular in 2008 but new business in 2009 declined heavily

Distribution bond sales continued to falter in 2009

Money market bonds lost favor in 2009, a year after being introduced as a new bond category

Investment bonds still remain a viable investment product but discerning the suitability of a bond for any individual will be more complex

Investors will still question the role of unit-linked bonds in the future as they lack elements of protection against market volatility

A with-profits revival will be seen over the next five years, at the expense of distribution bonds

Guaranteed bonds will continue to suffer a decline in sales in 2010

Money market bonds will lose their popularity among investors going forward

The best investment product depends on individual circumstances but there are three key facts which keep a bond broadly attractive as an investment

Only 5% of the population pays CGT

The majority of bond holders are basic rate taxpayers at the time of encashment and the changes to CGT make bonds even more attractive for these investors

An investment bond is a flexible product that can be adapted as an individual’s circumstances change

There are clear circumstances in which a bond is an advantageous investment

However, investment bonds are not favorable to all scenarios

Market Issues

Consumers’ low risk tolerance is affecting the investment bond market

Consumers are risk-averse and prefer safer or guaranteed returns

Investment bonds need to attract the less affluent consumer who is unwilling to take any risks with their cash

Prevailing economic conditions continue to pose a key challenge to investment bonds

Recent changes to taxation will impact the investment bond market

Changes to CGT announced in the June 2010 emergency budget may prove beneficial to the investment bond market

Under the old regime the tax structure gave a clearer advantage to investment bonds

A flat rate of 18% CGT was the prior arrangement that impacted the investment bond market

The changes to CGT in April 2008 were more far-reaching than their intended target

The tax treatment of investment bonds has not changed

Investment bonds are taxed within the income tax regime rather than as capital gains

An investment bond carries a 5% tax deferred withdrawal allowance

A tax charge can arise whenever a chargeable event occurred

Technological innovation centering on wraps is helping overcome the challenges of investment bonds

There are eight key areas where a wrap platform will help overcome challenges

The tax complexity of bonds and income-drawing options will drive growth in distributing investment bonds via wraps

Advisors are looking to actively move investment bonds onto wraps over the next 12 months

The full advantage of wrap platforms will be realized by placing legacy business such as with-profits bonds on platforms as well as new business

Wrap platforms have evolved from the fund supermarkets of the late 1990s

The Datamonitor definition of a ‘pure wrap’ has become a market standard

The Retail Distribution Review has inevitably affected the way in which investment bonds are sold and distributed

The RDR aims to increase consumer access to financial products and services by offering a tiered system of financial sales and advice

The RDR will address concerns about poor returns and high exit fees in the investment bond market

Poor returns and high exit fees in an underperforming market leave investors in an impossible situation

The Treating Customers Fairly initiative has helped to increase investor understanding about investment bond products and prevents the possibility of mis-selling

The TCF initiative aims to create a more efficient and effective market

The TCF initiative will filter out poorly structured and poorly performing providers to make investors aware of the risks involved in investment bonds

Competitor Dynamics

Providers should make investors aware of clear circumstances in which a bond is an advantageous investment

Investors in mutual funds pay tax on gains and on income, which gives bonds an advantage

A higher rate taxpayer can receive income from a bond and defer tax

Bonds can be assigned to avoid an income tax charge

A bond is an efficient investment for inheritance tax planning

Providers are offering product, service and technological innovations to help IFAs and clients understand the complexities of investment choices

Scottish Widows and Clerical Medical, with their full suite of online investment planning tools, are forging ahead in the innovation stakes

Scottish Widows and Clerical Medical offer online calculators to help IFA clients determine the appropriateness of bonds

The increasing importance of the peripheral features on an investment bond offering will emerge in a post-RDR landscape

Lloyds Banking Group wrote the highest investment bond new business in 2009

Distribution Dynamics

The sale of investment bonds is firmly focused through the IFA channel

Fluctuations have taken place in the distribution of unit-linked and non-unit-linked bonds

The distribution of unit-linked bonds migrated back to IFAs and whole of market advisors in 2009 after being picked up by non-bancassurance single tie channels in 2007

Non-unit-linked bond distribution through IFAs has grown rapidly and sharply

Wrap technology will be a key driver in the distribution of life products

Appendix

Data

Product definitions

Life-based savings products

Life assurance

Single premium life

With-profits bond

Unit-linked bond

Income and growth bonds

Guaranteed equity bonds

Distribution bonds

Purchased life annuities

Other bonds

Annual premium life

Endowment policy

Whole of life insurance

Term assurance

Income protection

Critical illness

Collective life

ISAs

Personal pensions

Stakeholder pensions

Group personal pensions

Department for Work and Pensions (DWP) rebate

Employer-sponsored stakeholder (ESS) pension

Self-invested personal pensions (SIPPs)

Free-standing additional voluntary contributions (FSAVCs)

ABI definitions of distribution channels

Independent financial advisors (IFAs)

Direct sales forces

Tied agents

Multi-tied agents

Bancassurance

Direct marketing

Telesales

Other

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

Browse complete UK Investment Bonds Market Report

Browse all Banking and Financial Market

Browse all Datamonitor Market Research Reports

Browse all Latest Reports

Related Reports:

The Future of UK Investment Bonds 2009

The UK Used Car Trade Flow 2010

Alternative Energy Monthly Deal Analysis: M&A and Investments Trends – March 2010

About Us:
Reports and Reports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.

Contact:
Ms. Sunita
7557 Rambler road,
Suite 727, Dallas, TX 75231
Tel: +1-888-989-8004
Source: Market Research
Blog: http://reportsnreports.wordpress.com/
Blog: http://reportsandreports.blogspot.com/