"Two in five advisers say their customers are more willing to have protection discussions as a result of Covid-19 and more than half have seen protection discussions increase in the past 12 months."
The survey of 5,000 consumers and 253 mortgage advisers revealed that 1 in 4 advisers are now passing protection business to a specialist, up from 1 in 7 last year.
40% of 18-34s say they would consider income protection as a result of Covid-19 when they wouldn’t have before - twice as many as those aged 35-54 (19%) and 10 times as likely as over 55s (4%).
However, 55% of mortgage customers who used a broker have never bought protection products from them with over a third (37%) saying they don’t think they need it. 52% of consumers think income protection is important yet only 7% have it.
99% of mortgage advisers say they raise protection with their clients, but two thirds of consumers don’t remember discussing it.
42% of consumers think advisers only bring up protection to increase their commission but half (47%) would change their view if their adviser took more time to talk about it (14%), explained why they felt a protection discussion was important (20%), or put more emphasis on how protection products could help them (19%).
Robert Sinclair, chief executive of AMI, said: “As with many reports there are both positives and negatives to draw on, with progress being made in some areas whilst others clearly show that we still have work to do. It’s positive that we are seeing consistent messages from consumers again this year, in the sense that we now have a clearer picture of areas that need our attention. Too many consumers distrust the motivations of their adviser. It’s important for us to have proper dialogue as a sector about how we overcome this – we hope it will be an area of priority for AMI’s Protection Specialists Group in 2022.
"We would like to thank Legal & General and Royal London who have joined us again this year and made it possible to carry out this extensive research, as well as the many advisers who contributed to the report.”
Craig Brown, director of intermediary insurance at Legal & General, commented: “There are some real positives to be taken from this – two in five advisers say their customers are more willing to have protection discussions as a result of Covid-19 and more than half have seen protection discussions increase in the past 12 months.
“However, the report also reveals that there is still a disconnect between the messages advisers think they are conveying about protection and what is actually being heard. There is already a great deal of support available from providers to help advisers with this challenge – at L&G we have a dedicated ‘Market Development’ team who are there to help brokers make sure their customers hear about the most appropriate cover at the right price – and we’ll continue to invest in services like this so we can support advisers to have better and more meaningful conversations with the goal of protecting more customers.”
Julie Scott, chief commercial officer at Royal London Intermediary, added: “As society continues to recover from this crisis, we’re starting to see some interesting trends, especially in relation to how protection policies and protection advice are viewed. This report puts a spotlight on the current opportunities and challenges we face, as we work together to deliver the very best outcomes for our customers in a post pandemic world. One of the key issues is how to engage better with clients about the value of protection, and we all need to step up to the challenge of better equipping advisers so they can have more meaningful protection discussion and improve client awareness.”