Mortgage intermediaries who are seeking to increase protection sales are urged to ensure they fully understand the added-value benefits included within these insurance products. Not only is this a much more compelling sell but the better informed that intermediary is, the better they are able to support their clients, according to RedArc, a third-party nurse service often included within insurance policies.
Protection insurances such as life insurance, critical illness insurance and income protection insurances, no longer just offer a financial pay-out in a time of crisis but also offer a wealth of other types of support including medical, and emotional.
“It is widely known that many mortgage intermediaries turned their attention to protection products in lieu of mortgages as COVID-19 stalled the housing market, and if this results in clients being better protected, that is a very good thing. However, protection is no longer just about getting a lump sum. It is important that advisers make clients aware of the support services included within these products so that their client can make an informed choice about the whole package of benefits, not just be focussed on the potential financial pay-out,” says Christine Husbands, managing director for RedArc.
No claim necessary
In many cases, added-value services within protection products support the customer and their immediate family during the lifetime of the policy, even when no claim is made. And of course, when claims are made, such as after a major accident, illness, trauma or bereavement, a financial pay-out is valued but it doesn’t stop the long-term emotional stress of dealing with day-to-day life.
Six examples of how protection insurance products can support intermediary clients during unpredicted life events:
- A client is unable to work during investigations for a musculoskeletal issue following a serious car accident. Their income protection policy provides financial assistance but the added-value support also helps the client as they become depressed through an inability to work. Early intervention mental support is provided at no cost to the client or intermediary, and talking therapies are provided.
- After a fall, a client’s father is unable to live independently and she takes on the role of sole carer. The added-value support within her life insurance policy provides helpful information on being a carer for the first time as well as signposting her to local support groups. The client is also given advice about how to access benefits for her father and herself as his carer.
- A client’s young daughter is diagnosed with cancer. The client speaks to a nurse adviser for emotional support via his critical illness policy as well as being given reading materials to help understand the child’s condition. At a later date, further advice and research is undertaken to find respite care.
- A single man returns home after an operation and needs immediate practical support at home including sourcing medical aids and equipment relating to his condition. His critical illness insurance policy ensures he receives practical advice, emotional support and some domestic help to manage at home until he is more mobile and as he comes to terms with his ‘new normal’.
- A gentleman receives a diagnosis for a chronic health condition but has concerns about the suggested approach to treating it. His income protection policy is already paying out as he hasn’t been able to work for several months, but the added-value support helps him organise a second medical opinion and have peace of mind about the most appropriate treatment course to take.
- A young woman experiences a late miscarriage and her mental health suffers as a consequence. Although no claim is made, her husband’s life insurance policy allows her to receive valuable long-term emotional support from a nurse experienced in this form of loss, relevant reading materials, contact with a local support group and a course of structured bereavement counselling.
Christine Husbands said: “Many insurers should be commended for the breadth and depth of support that is now available within their products. However, unless the intermediaries on the front line of giving client advice take the time to understand what’s available, they cannot possibly communicate it to their clients. That can mean a client is more likely to buy on price instead of value. And even when added value is included within a policy, the adviser needs to make it crystal clear to what extent and how to access it.”
There are huge variances in the types of added-value support that is available and so RedArc urges mortgage advisers to ensure they are comparing like-for-like before discussing a selection of products with their clients. Some providers will not include any support, others will offer very ‘light-touch’ support which might include a set number of counselling sessions or limited support via a wellbeing app. However, others will offer more comprehensive support tailored to the specific needs of each individual, available for as long as the client needs it.
Christine Husbands concluded: “Particularly with many brokers needing or wanting to reconfigure their business model due to the COVID-19 pandemic, I’d advise mortgage intermediaries to familiarise themselves with this aspect of the protection market in order to provide the most appropriate advice to their clients.”