Demand-side factors

The growth in the secondary market for life insurance has been fuelled by a noticeable fall in consumer confidence in the primary market. The main cause is the downturn in the equity market, which has caused many endowment policies to under-perform, causing some shortfalls in return for investors. This instability and nervousness has brought more and more investors, especially trustees and their high net worth clients, into the secondary or traded market, which still gives considerable scope to purchase policies with a high realisable value at very competitive prices.