Re-Insurer Swiss Re has released its review of the insurance industry which highlights consumer's demands for increased simplicity and clarity.
It also identified impending challenges from regulation and Europe as key areas of concern for the sector.
The Insurance Report: The Cost of Doing Nothing, includes a survey of 1000 members of the public and contributions from senior figures throughout the market.
Ron Wheatcroft, Vice President of Client Markets for Europe at Swiss Re, has called on the insurance industry to work harder and simpler to increase consumers' engagement and awareness of their needs and position.
One key finding was the public's lack of understanding about products that they either bought or were offered, finding them too intricate or poorly communicated.
Wheatcroft said: "We really need to sort out the complexity and ask if we actually need it?"
He also explained the "Perception Gap," that people are still not aware of what cover they have.
For example, there would be about seven million more income protection policies in place if everyone who thought they had one actually did.
"Advice is essential," Wheatcroft continued.
"We have to get back to the basics that this is what people need to do and keep it very simple. Regarding advice and fees, we need to be very engaged with the FSA about where they are going (with the Retail Distribution Review - RDR) and what the implications are for people left behind. The worst possible outcome from RDR would be that poor people just get excluded.
"This also becomes a potential bind for the state," he added.
However, the public's opinion of independent advice was positive as 58% said they would look for independent protection advice, with 51% of those (31% overall) prepared to pay for it.
Unfortunately many of those prepared to pay were higher earners, and when it came to fees a third (34%) were unsure how much to pay, with a quarter (24%) only prepared to pay less than £100, and 29% willing to pay between £100-£199.
It was also especially notable that nine out of ten people (90%) only wanted to pay a one-off fee
Richard Verdin, director of protection marketing at Aviva, responded positively to the report's results, and that it is consistent with what he hears.
He said: "I'm all in favour of simplicity and clarity."
"I think customers want simpler products but they also want simpler processes, which is a concept I favour. They want guidance as much as advice, and the key to paying for that is customer outcomes.
"We don't see any evidence of commission producing poor customer out comes," he added.
