The global financial protection market size was valued at $53,340.12 million in 2020, and is projected to reach $77,439.23 million by 2030, growing at a CAGR of 3.9% from 2021 to 2030.
Financial protection insurance provides regular payments that replace part of income if the insured person is unable to work due to illness or an accident. It pays out until the insured person can start working again or until they retire, die or reach the end of the policy term, whichever is sooner. It typically pays out between 50% and 65% of the insured person income if they are unable to work. It further covers most illnesses that leaves the insured person unable to work either in the short or long-term depending on the type of policy and its definition of incapacity.
Increase in instances of several diseases, such as cancer, dengue, and diabetes, which lead to longer hospitalization periods is considered as an important factor boosting the global financial protection market growth. In addition, rise in the unemployment rate during the pandemic and customizable financial protection plans are some of the major factors that propel the market growth. However, lack of knowledge about coverage included in financial protection policy and increase in financial protection premium cost are some of the factors that limit the market growth. On the contrary, increased usage of advanced technology among financial protection professionals to offer income protection plan and high rate of unemployment has increased the adoption of financial protection, which is expected to grow tremendously in the coming years.
The report focuses on growth prospects, restraints, and trends of the financial protection market analysis. The study provides Porter’s five forces analysis to understand the impact of various factors, such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers, on the financial protection market growth.
The financial protection market share is segmented on the basis of type, policy coverage, end user, and region. By type, it is segmented into long-term financial protection and short-term financial protection. By policy coverage, it is bifurcated into payment protection and mortgage payment protection. By end user type, the market is divided into men and women. By region, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
The report analyzes the profiles of key players operating in the financial protection market size such as AXA, ABI, American International Group, Inc., Aviva, Aon, Citizens Advice, Marsh Ltd., StanCorp Financial Group, Inc., The Guardian Life Insurance Company of America, and Zurich. These players have adopted various strategies to increase their market penetration and strengthen their position in the financial protection market size.
Long-Term Financial Protection segment accounted for the highest market share in 2020.
Covid-19 Impact Analysis
The COVID-19 pandemic has led to rise in job cuts, which has left people unemployed. Therefore, there is an increased need for purchasing financial protection among customers to perceive better medical facilities & healthcare treatments amidst the growing spread of coronavirus. Furthermore, there is a rapid growth in hospitalization due to the COVID-19 outbreak and simultaneously job losses. Thus, financial protection claims have increased tremendously. In addition, the spread of this health crisis across the globe is one of the major reasons behind the increase in financial protection premium as the situation has laid an enormous pressure on the insurance companies in the financial protection market.
Top Impacting Factors
Income Protection Provides Mental Peace And Help To Focus On Recovery
Being out of work for even a short period can have serious long-term negative consequences for most people. Because of absence from work, the savings of insured people may need to be used, retirement plans can be delayed, children’s of the insured person may need be sent to different schools because of high fees, high-interest loans need to be taken out to cover urgent bills, or they might be declared bankrupt. Hence, income protection provides a regular income to the insured person despite being temporarily out of work, which ensures that everything can be covered, thus ensuring the insured person is at peace and recovers quickly. Moreover, it can also take years for getting recovered from the injury for which the insured person cannot go to work. Therefore, by taking out income protection insurance, an insured person can ensure themselves and their family will be financially stronger while the insured person is temporarily out of work.
By Policy Coverage
Payment Protection segment accounted for the highest market share in 2020.
Moreover, financial protection also maximizes the chance of people to recover quickly, since they are aware of their financial situation. Therefore, income protection provides mental peace to the insured person and this helps the insured person to recover faster. Therefore, this is a major driving factor for the financial protection market growth.
Unstable Rate Of Unemployment
As the employment rate has been unstable causing recession, seasonal unemployment and job cuts leading to people temporarily or permanently losing their job. Income protection plans offer financial support for people suffering from diseases or any case for which they cannot work and earn. Therefore, demand for income protection is expected to further grow in the future attributing to rise in instability of employment. In addition, demand for income protection is brought into focus with rising awareness of people to put financial safety in place for themselves and their families amidst health concerns and economic uncertainty. Therefore, this factor provides lucrative opportunities for growth of the financial protection market.
Asia-Pacific would exhibit the highest CAGR of 6.1% during 2021-2030
Key Benefits For Stakeholders
- The study provides in-depth analysis of the global financial protection market share along with current & future trends to illustrate the imminent investment pockets.
- Information about key drivers, restrains, & opportunities and their impact analysis on the global financial protection market size are provided in the report.
- Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the financial protection market.
- An extensive analysis of the key segments of the industry helps to understand the global financial protection market trends.
- The quantitative analysis of the global financial protection market size from 2021 to 2028 is provided to determine the market potential.
Financial Protection Market Report Highlights
By Policy Coverage
By End User
By Key Market Players
The main benefit of having a financial protection policy or being a member of an employer-provided policy, is that the insured person can continue to pay their bills, rent or mortgage if they are unable to work due to an illness or injury. Moreover, increasing number of chronic diseases are causing people to get hospitalized, which stops income for people as they cannot go for work. Financial protection plans provide such consumers with financial stability to pay for their everyday needs such as bill payments, education fees, groceries, and medical bills. In addition, income protection helps insured person to recover faster from their illness without having to worry about taking care of their financial needs.
Availability of favorable financial protection landscape and access to multilevel financial protection policies accelerates the market growth in North America, particularly in the U.S. In addition, provision of financial protection to employees as a job benefit contributes toward growth of the market. Furthermore, increase in middle-class population in developing countries, such as India and China, fuels demand for financial protection, which serves as an emerging opportunity for the market in the coming years. Moreover, the COVID-19 pandemic has largely affected employment across several verticals, therefore, to cover living expenses during this period, people are taking financial protection plans.
Some of the key players profiled in the report include AXA, ABI, American International Group, Inc., Aviva, Aon, Citizens Advice, Marsh Ltd., StanCorp Financial Group, Inc., The Guardian Life Insurance Company of America and Zurich. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.