From Thomas Reeh
Mortgage Strategy’s editor starts his leader in the August 7 issue by saying, “Dubious selling practices and overpriced products have triggered a collapse of consumer confidence in income protection.”
He should have added that mortgage brokers have also suffered a collapse in confidence because of inflammatory and frightening media coverage. As insurance products are sold not bought, is it not broker confidence that’s the key issue here?
There have been umpteen anti-mortgage payment protection insurance campaigns. Even tabloid jour- nalists have had a pop at subjects they know nothing about, backed by a raft of so called industry experts promoting their own agendas.
We have all seen headlines such as ‘The ASU gravy train’, ‘Ambulance-chasing brokers’ and ‘ASU will be tomorrow’s endowment claims’. And yet we wonder why brokers aren’t selling MPPI.
Unfortunately, little airtime has been given to the consequences of consumers having no MPPI in place.
And there is little in Iain MacQueen-Sims’ cover feature in the same issue to restore broker confidence or underline the need for the sale of this product.
Restoring that confidence is vital as the broker community is the biggest distribution channel for mortgage sales in this country.
Also, there has been little or no media coverage given to some excellent product developments seen recently. Assurant’s Matrix MPPI addresses all the old concerns about MPPI, but apparently that’s not interesting. Brokers could win back market share and restore their MPPI selling confidence with this product.
Let me also touch on the sticky subject of lump sum MPPI policies. There is a place for them, particularly for sub-prime clients who have a record of having direct debit mandates cancelled by their banks.
And I’m talking about flexible lump sum policies – pro-rata refunds if cancelled early and ability to decouple the accident, sickness and unemployment elements.
There are some great products available. Consumer credit levels are spiralling out of control, repossession rates are in double digits but what are we doing to promote broker confidence in selling products that are vital if we are to treat our customers fairly and promote consumer confidence?
Chief executive officer
Black and White Mortgages