Compulsion Soft compulsion Incentivisation Conditional need Voluntary – (e.g. through tax) to purchase purchase (e.g. for mortgage approval) EXAMPLES Motor (3rd Party) Personal Accounts Savings for private Property insurance Life cover introduced in 2012* pensions Home contents Pet Income protection Defined contribution (*auto-enrolment Public liability & Critical illness pension must be into workplace professional Private medical converted to a pensions) indemnity insurance secure Investments income in retirement Employers’ liability RATIONALE Public safety Ensure basic level of Higher savings Avoid homelessness Benefit perceived pension savings* ratio and reduce to be largely to Effective use of tax dependency on the Provide coverage for the individual incentives Drive lower benefit State 3rd parties and therefore no payments support from the State (*basic state pension based on existing National Insurance contributions being unlikely to provide
Compulsion Soft compulsion Incentivisation (e.g. through tax) Conditional – need to purchase (e.g. for mortgage approval) Voluntary purchase EXAMPLES Motor (3rd Party) Defined contribution pension must be converted to a secure income in retirement Employers’ liability Personal Accounts introduced in 2012* (*auto-enrolment into workplace pensions) Savings for private pensions Property insurance Public liability & professional indemnity Life cover Home contents Pet Income protection Critical illness Private medical insurance Investments RATIONALE Public safety Effective use of tax incentives Ensure basic level of pension savings* Drive lower benefit payments (*basic state pension based on existing National Insurance contributions being unlikely to provide Higher savings ratio and reduce dependency on the State Avoid homelessness Provide coverage for 3rd parties Benefit perceived to be largely to the individual and therefore no support from the State
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