Introducing the strangest tribe in financial services

There is no group of people in financial services stranger than the Protection People. Stumbling into one of their arcane rituals yesterday (otherwise known as Marketforce’s Future Of Protection conference) was a bit like stumbling into a freemason’s dinner or a voodoo initiation ceremony. There were a lot of people there saying and doing peculiar things, and as an outsider it was impossible to make much sense of it all.

The Protection People’s main concern is life assurance and related products, but in fact their real speciality is paradox and contradiction. There’s hardly a single subject on which they all agree, and on most of the really important subjects the majority of those attending are each able to hold entirely unreconcilable ideas in their minds at the same time.

For example, they fervently believe that consumers desperately and urgently need educating in the ways of life assurance, but none of them is willing to commit any worthwhile effort or resources to the task.

They feel sure that their slowly-declining industry is in dire need of innovation, but they seem to leave it to one firm – Ageas – to do it all.

They’re convinced that their products aren’t very price-sensitive, but their only major marketing tactic is to launch savage bouts of price-cutting to the detriment of everyone.

They’re committed to providing individual protection, either through intermediaries or direct, while at the same time believing that the only real opportunities lie in providing group schemes via employers.

They bemoan the fact that there’s so little consumer advertising for their category (the recent thoughtful and well-made AVIVA commercial, with Paul Whitehouse, is greeted like the second coming) yet none of the others spends a penny on it themselves.

They spend huge amounts of time and money on developing ever-more complex and sophisticated underwriting processes, while also recognising that the only big success in the consumer market is Over 50d cover which involves no underwriting at all.

At a higher level, they believe passionately that they could and should redefine their role in society, working with Government to privatise a lot of universal benefits like Jobseekers’ Allowance and Disability Benefit, but at the same time they’re also highly attracted to the extremely antisocial but lucrative idea of cherry-picking nice clean healthy lives and leaving everyone else to fend for themselves.

And unable to decide which of their three main products – life assurance, critical illness and income protection – has the most to offer, they default to the impractical proposal that consumers should spend huge chunks of their precious income on a combination of all of them.

In fact, as far as I can see, the only thing they agree about is the folly of the recent ECJ ruling on sex discrimination, and although it’s refreshing to see such a display of unity I must remind you that as I argued in this blog a few days ago, this point of view is of course completely wrong.

But otherwise, all of these fundamental disagreements and differences in perspective dominate the proceedings – while, just as strangely, causing virtually no trace of discord or even debate. Yesterday’s proceedings sailed serenely on, maintaining the most even of keels, despite the glaring and unmistakeable inconsistencies ricocheting around the room on almost every issue.

As the day unfolded I became more and more mystified by this, but in the end I think I got it. Another characteristic of Protection People is that they are infinitely much more self-righteous than anyone else in financial services. They’re quite certain that they’re doing God’s work. Religious people have to be able to hold contradictory ideas in their minds at the same time – Christ is man yet Christ is God and so forth. That wasn’t a conference I was attending yesterday. It was a synod.

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