A survey on whether fees in pure protective markets provide value to consumers was launched by the Financial Conduct Authority.
The city's Watchdog says the industry is attracting “relatively few complaints,” while also “concerns that the committees used to sell these products may have an impact on the outcomes consumers receive and the product's value or design.” 
The protection company paid around £4.855 billion in its 2023 claim, and the mortgage will be used for construction and life insurance, as well as for serious illness coverage and income protection.
Regulators say they will look into whether the market research is next.
The committee structure encourages advisors to propose switch that may not be beneficial to consumers
Insurance premiums are raised by insurance companies to pay higher fees by intermediaries
Products provide fair value
The market supports innovation and growth
The Watchdog study focuses on selling four products. It's a term guarantee, coverage for serious illnesses, income protection insurance, and overall life insurance.
That initial finding and the proposed next steps will be published by the end of the year.
“The executive director of oversight, policy, competition and international financial conduct at Sarah Pritchard said:
“We are determined to ensure that the market is working well and to deliver positive results for our customers by suggesting testing or improvements to our customers.
“When we start today's research, we can review the details before considering the next steps. We welcome feedback that will help you keep stakeholders updated regularly and plan the scope of this review.”
Royal London policy director Jamie Jenkins argues that three key areas should be addressed by regulators.
Jenkins said: “First of all, protection is recognized as a common sense purchase, something that is usually sold rather than purchased.
“Advisors need incentives to help clients understand their needs and how to meet them. Any solution should ensure that recommendations are fair and provide fair value, while recognizing the need for fee flexibility.
“Secondly, building consumer trust is an important step to improving the market.
“The industry needs to strengthen its practices and ensure that consumers can make informed decisions about their finances and trust in the support they are being provided.”
“Finally, consumers need access to comprehensive, targeted advice to ensure they can consider protection while meeting diverse needs and budgets.”
But more equitable finance director Tim Hogg points out: “The pure protective market may be doing better for consumers.
“The design and scale of some fee payments appears to support consumers.
“Ultimately, when many people make a profit from it, they don't buy life insurance. Communications about life insurance remain complicated and uncomfortable.
“The buying journey can involve a long, high level of friction that triggers negative emotional responses in medical questions.
“It's great for financial conduct authorities to look at ways to drive more innovation in this market, from communication and travel design to product mechanisms.”
