Seven out of 10 Independent Financial Advisors (IFAs) believe underinsurance problems around life and critical illness cover will deteriorate according to research by Specialists4Protection.co.uk.
Of the 51 IFAs surveyed, 72% believe there is a growing threat of people not having enough life insurance and critical illness cover because fewer intermediaries are selling it.
The research shows that since 2011, 8% of IFAs have stopped selling life insurance, 3% plan to do so within the next 12 months and another 5% intend to stop selling it in the future, with corresponding figures for critical illness cover being, 8%, 5% and 11% respectively.
Site managing director Paul Lister, said: "The intermediary market is responsible for a huge level of sales of life and critical illness cover, but as fewer intermediaries are selling this, the problem of people having no cover here or inadequate insurance increases.
"With 42% of people with life insurance claiming that they only have life insurance to cover up to two years of their salary for example, this is already a huge problem and I fear it will only get worse as access to professional advice dwindles."
The main reason IFAs gave for stopping the sale of these policies was a shift of focus to selling investment products, while 19% said they did so because there was not enough money to be made.
