Don’t call my customer, call me

Calls from lenders trying to cross-sell insurance intimidate borrowers, undermine advisers\' relationships with their clients and show what lenders really think of us, says Sue Read

Cross-selling is a thing of the past, isn’t it? That’s what lenders would have us believe. They depend on advisers for such a high proportion of their business that they wouldn’t do anything to undermine us.

How hypocritical can they be? They may not call it cross-selling any more but it still goes on. For example, take buildings cover. I regularly advise my clients to take a lender’s buildings insurance policy. I do this because I am not an expert in this field and would never claim to have researched the best policies for my clients.

I reckon a lender has a duty to ensure the cover it arranges fits its own criteria, such as whether it is sufficient to cover the rebuild cost stipulated by the valuer. Its cover will be reasonably competitive, at least for the time being.

Whatever a lender may say publicly, I know it will process an application more quickly – and possibly more flexibly – if the client is taking its general insurance. If a client does this, they always have the option to re-broke the cover wherever they wish once their mortgage has completed. That’s fine by me.

The client gets a quicker offer, they complete sooner and are a satisfied customer. And they’ll come back to me again next time because I’ve given them good advice and have not appeared greedy for commission.

I can live with this, even if my boss might prefer me to sell more general insurance. But what I cannot accept is interference in the process from a lender.

At application stage, I discuss the options with my clients and we agree a course of action. The lender should accept whatever decision is reached.

Don’t get me wrong, a lender is perfectly entitled to ensure a client has adequate buildings insurance. But isn’t the solicitor supposed to check this? I don’t mind them asking my client to prove this as completion approaches. By this time, the client has their mortgage offer and is almost certain they will get the property they want or remortgage to the scheme they have chosen.

But I object to my clients being called by a lender who is just checking what insurance the client is taking before an offer has been approved. Clients feel vulnerable at this stage of the process. They fear that not taking the lender’s cover will jeopardise their mortgage application and this call can be intimidating.

Why can’t the lender call me? I am the adviser and the lender values me. I can answer the lender’s query. I may even give the lender the business if I haven’t finally dealt with it. I tell my clients I will handle all of the paperwork involved in their mortgage application, taking the hassle out of it for them.

Being contacted by the lender directly undermines my relationship with my client and diminishes the so-called value that the lender places on their relationship with me.

The value of intermediaries to lenders, it seems, is only paid lip service.