Given what is going on in the world right now, 2021 already feels like a lifetime ago but certainly in our business space it is important to reflect on what happened during those 12 months, and how we build on those strong foundations.
My assumption here of course is that you, as an adviser and your firm, had a very busy and productive year, particularly given the strength of demand driving mortgage activity and business volumes.
Certainly, all the figures coming out of 2021 appear to show how strong it was for the advisory profession. Recent statistics from IMLA for example revealed the average adviser handled 103 cases last year – the highest volume since the trade association began tracking such data, and a 32% annual increase on caseload volume compared to 2020.
Our own evaluation of advisers and firms within the Stonebridge network appears to resonate with that data; indeed, our completion data per adviser is up on that 103 figure but not a million miles away.
From what we can see the provision of mortgage advice was likely to have been the core product area, however as we know, advisers are not one-trick ponies here – or at least they shouldn’t be – and those mortgage clients will undoubtedly have had other needs and requirements, particularly in ‘sister’ areas such as protection and general insurance.
For those firms who are on top of their ancillary sales and their advice provision in these areas, the benefits to be had in taking these products seriously will not need spelling out.
However, we know that this isn’t the case right across the board. How many of your completed mortgages last year, for example, had no accompany protection provision? It’s not unusual for industry figures on this to number 60/70% and again you won’t need me to spell out the significant ‘protection gap’ that this is adding to.
Now, some firms are ‘willing’ in this area. They want to write the business but, for whatever reason, never get round to it. Or say they will follow-up later once the mortgage is completed, by which time it’s often too late. As with anything, the longer you tend to leave it, the less likely you’ll be able to secure the business and the client has often moved on mentally from any requirements that might have been better addressed at the time of the mortgage advice.
However, and here might be the real nub of what you’re missing out on, we all know that while it is excellent practice to offer protection advice and there are countless cases when it was badly-needed by a client later on in their lives, that still might not be enough to get some firms into the ‘protection zone’.
Perhaps this will help. A quick estimate around all those individual adviser mortgage completions last year and client protection needs which would accompany them – based on average protection premiums, etc – reveals that per adviser, were you to do nothing in the protection sphere, you would be missing out on around £75k income from that business.
As mentioned, that’s per adviser within a firm. Now, of course, some advisers will provide that advice and deliver the policies, but there’s a huge number that do not. Let’s go one step further. For those advisers who don’t want to carry out this part of the advice process, and who would simply prefer to introduce the client on to a specialist protection adviser – we have a Stonebridge Protect proposition for just this type of business – they could expect to earn around £25k for those clients who completed a mortgage.
Now, there are clearly a couple of things here. Firstly, that’s a significant amount of money for any business. The £75k would allow almost every firm I could think of, wherever they might be based, to employ an in-house protection specialist themselves. And for those who want to focus on the mortgage, well the introducing of cases to a specialist not only secures you income you would never see, but also – quite importantly – ensures you get the right outcomes for your client. Who doesn’t want that?
Overall, if you can see nothing else, then the income benefits to you and the firm should be compelling enough. It can’t however be half-hearted; whatever you decide to do, you have to focus on protection/GI, etc, upfront with clients when discussing the mortgage. But if you do tee it up, and you don’t want to advise, then it can be as simple as pressing a button in order to refer a client over; at Stonebridge the technology we use is truly this simple and can clearly bring so many benefits to the business that, if ignored, would be lost – probably forever.
Don’t get to protection or any other ancillary opportunity later; get to it right now at the point of client contact and see the real benefits this can deliver to your bottom line.
Lesley Sharkey is recruitment director at Stonebridge