View more on these topics

The importance of mortgage protection – the panel answers questions

On 30 October, Mortgage Strategy, in association with The Value Exchange, took part in a live Wired session on the importance of mortgage protection.

Deputy editor Gary Adams was joined by a panel comprising One77 Mortgages protection sales director Katie Pisanu, The Buy to Let Business head of strategy and growth Jon Nixon and Coreco brand director Andrew Montlake.

You can watch the video here.

As well as discussing why protection is such an important part of the house-buying process and why many brokers are hesitant to bring the subject up when dealing with clients, the panel fielded questions sent in by viewers.

With just 30 minutes to cover all this, it’s no wonder that the panel didn’t get around to answering everything sent in, so please find below two of the panel’s answers to three of the questions and comments that went unanswered:

Question: Can you turn to an ASU GI policy where cover is not available for a life assurance product? These products are more accessible for those with pre-existing conditions.

Andrew Montlake: I’ll leave this one to the experts!

Katie Pisanu: It would massively depend on the individual clients needs but I wouldn’t say you can ‘replace’ life assurance for ASU. They are completely different products and ASU is a very limited policy. I would suggest if a client has medical conditions, complete a full fact find, speak to the providers underwriter and hopefully you can match it to at least some sort of cover… as some is always better than none!

Jon Nixon: These products are more accessible for those with pre-existing conditions. They also do very different things so I wouldn’t recommend it with a client you have identified as requiring life cover but can’t get it to use ASU as a gap filler. You should underwrite across the market as there are many options these day with some very strong impaired life companies – and if all else fails and if age dependent, perhaps go to an over-50s plan.

Question: Do you think the industry is focusing on the negatives around protection not being advised upon when it should be and not shouting about the positive stories where protection makes a difference. Surely this would help protection reach out to more clients?

Andrew Montlake: Yep I agree and that was sort of my point around how these products are marketed. They need to be sold in a positive light, highlighting benefits and really helping the clients understand how it will help them. Not in a project fear kind of way that people just get turned off from.

Katie Pisanu: Sadly that’s probably correct, or at least to an extent. We have some case studies on our website highlighting the fantastic benefits that protection can offer and I know other brokers and providers do too. I don’t think the press help when they home in on a client that didn’t get a payout for whatever reason, as they never highlight the ones that do. But yes, there is definitely more that could be done.

Jon Nixon: I agree – providers and brokers alike have a duty to talk up the good stories. The unfortunate thing is bad new sells, so the press tends to focus on the attention grabbing stories. I believe that providers could invest more into delivering some success stories to TV/Radio outside the industry as its us that need convincing, its Joe Public

Comment: I think it is naive and sanctimonious to say that incentivisation should not be a part of the broker mindset. We can look after our clients, and make a living, too!

Andrew Montalke: Of course we can and we should all battle to make sure we get a fair days pay for a fair day’s work. On this point, however, simply incentivising brokers with more commission is not the answer. Commission levels are adequate as it stands, in fact I would be happy to see this reduced slightly to help reduce the cost for clients. This may help us sell more and ultimately earn more. There has to be more than just more money when helping and advising clients.

Katie Pisanu: Of course, we can look after our clients and make a living but, personally, I think the proc fees from providers are more than fair and that ‘doing the right thing by your client’ surely also has to play a part in the advice process.

Jon Nixon: Incentivisation should be part of what we do – the point we made is that getting more for doing nothing is different. I would urge consideration of the client first, before selecting the right product and provider according to the price and proposition and the commission will be the result, not the other way round!



Interest rates predicted to rise in early 2020s

On 2 August 2018, the Bank Of England raised interest rates from 0.5 per cent to 0.75 per cent. The previous base rate rise was in November 2017, from 0.25 per cent to 0.5 per cent, which was the first raise for more than a decade. Mark Carney, governor of the Bank of England, said in August […]

Budget 2018: Help to Buy scheme to end in March 2023

Although the Help to Buy scheme was not mentioned in chancellor Philip Hammond’s speech during the Budget today, the Budget report reveals that the popular incentive will end in March 2023. The report also details that from April 2021 until the scheme ends, different regions will have different price caps, ranging from £186,100 in the […]


News and expert analysis straight to your inbox

Sign up