Pure and simple – Mortgage Strategy

The release of the Financial Conduct Authority’s interim findings on the pure protection market is an important milestone in a lengthy and wide-ranging review of the sector.

It’s reassuring that the FCA is not, at present, proposing market-wide structural interventions. This clarity supports stability and continued investment in a market that plays a critical role in supporting consumers with quality advice.

However, the absence of intervention should not be mistaken for a signal that the work is done.

The FCA’s own findings reinforce the role of advice

Some have commented that the interim report feels “bland”. I disagree. I see the result of sustained engagement and hard work across the sector over the past few years and throughout the course of the market study.

Firms have invested considerable time and resources into strengthening fair-value assessments, enhancing governance frameworks and embedding the Consumer Duty.

There has been extensive data and information sharing in open engagement with the regulator. Advice businesses have articulated clearly the customer benefits of their services and demonstrated oversight of remuneration and product suitability.

The FCA’s own findings reinforce the role of advice. The report highlights that consumers rarely consider protection proactively and that intermediaries play a key role in navigating complex options. This echoes the findings from years of research Ami has done via Protection Viewpoint reports.

We need to be mindful of reforms that could unintentionally dilute touchpoints

Around 80% of protection sales are delivered via advisers, with only 1% through price comparison websites.

These figures matter. They demonstrate that, even in an increasingly digital environment, consumers continue to rely on professional advice. This is not a market dominated by purely transactional journeys; it’s a market where complexity and underwriting nuances make professional advice essential.

Care with reforms

That is why parallel regulatory developments, such as the Mortgage Rule Review and the removal of the advice interaction trigger, must be considered carefully. If more consumers move towards a non-advised mortgage journey, who will have the protection conversation?

Who will review existing policies or raise protection needs at key life events?

We need to be mindful of reforms that could unintentionally dilute touchpoints. Accessibility to advice is not the primary issue in protection. Consumers already have advised, non-advised and direct-to-consumer options. The real challenge is awareness and recognition of value.

All proposals to reduce the protection gap should be considered, but is targeted support in this part of the sector an answer?

Unlike the investment market, the protection sector doesn’t face accessibility or advice affordability issues. Introducing targeted support risks adding complexity to a market that is not suffering from an advice accessibility gap.

The absence of intervention should not be mistaken for a signal that the work is done

That does not mean there are no areas for improvement. The FCA has rightly highlighted claims ratios, switching incentives and the customer claims experience as areas requiring continued scrutiny.

Firms must maintain robust oversight of replacement business, ensure remuneration structures align with fair value and consider how they can better support customers at the point of claim. Consumer Duty and fair-value requirements are living frameworks that must be continuously monitored and reviewed; it is not a ‘one and done’ piece of work that can then be filed away.

Behavioural nudges

The FCA is also exploring the role of technology and behavioural nudges.

This is an area where constructive collaboration is essential.

Ami’s own 2025 Protection Viewpoint research shows the extent to which consumers are dropping out of protection journeys. If digital innovation can reduce unnecessary barriers, that is worth pursuing. Likewise, clearer signposting to advice where consumers encounter declined quotes or exclusions in direct journeys could improve outcomes.

It’s reassuring that the FCA is not, at present, proposing market-wide structural interventions

Ami will be attending the FCA’s forthcoming workshops and will continue to engage closely. We will work alongside our member firms to ensure that the adviser voice is clearly represented and that the regulator fully understands the practical realities.

This interim report provides reassurance but also responsibility.

The regulator has set expectations, but it is our collective commitment and willingness to work together that will ultimately make a real difference.

Stephanie Charman is chief executive of Ami

This article featured in the March 2026 edition of Mortgage Strategy.

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