The Pink Network is from now on to ask anyone looking to join it to provide either proof of their own income protection (IP) policy or their reasons for not having any.
The firm says this is to ensure that anyone joining the network has, as part of their overall business plan, a contingency in place should something happen and they are unable to work and earn an income. Secondly, by having a plan in place advisers are showing that they understand the overriding need to protect themselves and their businesses and are better-placed to talk about it to their clients, Pink said.
Pink already checks every potential adviser’s business plan and financial viability. The network recently introduced a new standard for every adviser to discuss income protection at the very first mortgage meeting. Pink will now apply this same standard to its own application process.
Pink is also encouraging existing members to have IP themselves, and although it is not insisting that everyone has IP, it is asking ‘what is your contingency plan?’ Pink will be having an open debate at its upcoming quarterly roadshows to ask: ‘How can you offer this type of policy if you don’t have it yourself? If you don’t understand there is a genuine risk to your livelihood, can you really understand the fundamental need for your clients to have this protection?’
Mark Graves, head of Pink network, said: “It is inconceivable to me that advisers joining this network haven’t taken care of their own financial situation. I’m not only concerned by someone exposing themselves to the risk of being unable to earn an income, but also their ability to sell this type of protection if they themselves have not considered how they would cope.
“The fact is that currently only 7% of mortgages are sold with income protection. This is why we launched our initiative to ensure all our advisers now talk about income protection at the first meeting with their clients.
“The next step was completely logical – where better to start than with the advisers who are helping their clients to make the biggest financial commitment of their lives? Initial feedback is good, advisers are agreeing with our stance, and Pink as a network will be stronger because of it.”