Swiss Re says the life market is changing as millions of consumers approach retirement with the option to self-manage their pension funds.

“The shift is creating opportunities for insurers, banks and advisers – and a race to reach people before retirement, when they are making critical decisions about how to manage their savings, generate income and protect their wealth,” the reinsurer notes in a global report.

According to Swiss Re, the change is already visible in some markets, including the US, where more than half of retirees chose to withdraw and self-manage their funds in 2018, up from 10% in 2000.

“This means that individuals are becoming responsible for more complex choices about how much income to take as cash, how much to keep invested, what to leave to their family and how to pay for care later in life,” the reinsurer said.

“To make the right decisions, the need for advice is growing – not only on retirement income, but also on wealth transfer and later-life care.”

Swiss Re highlights the importance of distribution as life insurers respond to the market shift.

“Distribution is at the heart of life insurance. It shapes who insurers reach, what they sell and how effectively they build and retain customer relationships.”

The reinsurer says the growing role of independent advisers, brokers and other multi-provider intermediaries is a structural trend in many markets, particularly where customers require complex advice and value access to products from a host of insurers.

“Several external and structural drivers are increasing the importance of life insurance distribution.

“Advice becomes critical as ageing populations take on greater individual responsibility for their retirement and navigate more complex pension and later-life financial decisions. For insurers and distributors, this brings forward the opportunity for engaging customers.”