"How can you help someone get into the biggest debt of their lives and not talk about protecting their home and keeping them in it?"
Some advisers might have lost confidence in talking about insurance citing they don’t want to offer an expensive price for a client to find it cheaper online. So, is it a bigger risk for advisers to talk about GI or not talk about it?
There is currently no legal impact if advisers do not talk about protection, but I would argue that advisers have a responsibility to do so as a duty of care. After all, how can you help someone get into the biggest debt of their lives and not talk about protecting their home and keeping them in it?
The rise of comparison sites is based on a focus on price, not cover levels. It is often likely to always be cheaper online, but the cover will rarely as good or adequate for what your clients need.
There have been so many horror stories this winter in the news about customers who didn’t have home insurance and ended up homeless or living in hotels at Christmas because they didn’t get advice. So, in today’s litigious world, I would say that the risk of not talking about insurance potentially outweighs the risk of having the conversation.
Having the conversation with every customer and offering a complete, holistic advice service and ringfencing them will ultimately create stronger relationships, avoid any legal issues later from ambulance chasers and protect a valuable customer relationship.
For me, advisers don’t have a duty of care to sell GI but do have a duty to at very least have a conversation about it and the need to get adequate cover, not just because it’s a requirement of the lender but also because it’s the right thing to do. It should be up to the client whether or not they would like advice on GI, not the adviser.
If conversations about GI aren’t happening, advisers are losing out on a significant source of income. As the trend continues for longer-term mortgages, the opportunities to support the client become fewer. Insurance is something that generally needs to be reviewed every year, which not only helps to maximise adviser income opportunities in the short to medium term but also build stronger customer relationships for the long term.
And let’s face it what’s the alternative to professional and considered GI advice? Your clients could go to a price comparison site, which offers no advice and end up making some dangerously poor choices. When you consider that these comparison sites make 27 times more profit than insurers, why would you want to leave your client at risk whilst also putting money in their pockets?