Could we be on the way to making financial protection sexy? OK, that’s probably a step too far, and until this optimism translates itself into sales, and protection becomes a must-have product, I should perhaps curb some of my enthusiasm.
But there has never been a better time to promote the virtues of protection insurance to clients. The gender directive comes into force in December and with it price increases.
Of course, there will still be individuals who are reluctant to take out cover and one scenario that IFAs may be faced with is clients who prefer to self-insure.
Rather than taking out a protection product, they will put the money they would have paid in premiums into a savings pot.
But for the average person, it would take eight lifetimes to build up a lump sum of £100,000 – the amount they might receive from a life insurance payout.
People can’t hope to put that amount away in savings. How would a family cope if something untoward happened before those savings had built up into a substantial amount?
When you take into account that someone could be paying £1,000 a month in mortgage repayments for the next 25 years, adding £10 a month for life cover isn’t a lot, especially for peace of mind.
Of course, they might live until the end of those 25 years – but what happens if they don’t?