Starting a revolution

The UK life insurance industry is being transformed by new disclosure requirements and by the entry into the business of up-start new companies and of firms with completely unrelated products. These companies, in particular, are placing the traditional life insurance industry under attack because they offer significantly lower prices, communicate more effectively with consumers and are able to improve customer value by eliminating middlemen. Many of the new insurance providers are 'virtual insurance companies.' They are companies with solid reputations in other markets, such as Virgin and Marks & Spencer, that have entered the insurance business to take advantage of the brand loyalty and reputation for quality they had earned in their traditional markets. Even without insurance expertise, they are able to compete in the market through outsourcing and the use of modern technologies.