Why might a customer be considered vulnerable?

A customer might be considered vulnerable primarily due to their personal circumstances. This can encompass various factors such as age, health issues, disability, mental health conditions, experiencing significant life events (like bereavement or divorce), or anything that may impede their ability to make informed decisions. Vulnerability is often context-specific, meaning a customer's situation could make them more susceptible to poor outcomes in purchasing products or services, including insurance.

In contrast, having high income does not inherently signify vulnerability; rather, it may indicate financial stability. Similarly, a lack of financial knowledge could contribute to vulnerability, but it is more of a symptom or result of personal circumstances like education or life experiences than a standalone factor. Additionally, frequently switching providers can reflect adaptability or a consumer’s search for better options, rather than a condition of vulnerability.