This is a sensitive subject in light of the pandemics impact on many people’s health, wealth and short, medium or longer term financial outlook. However, the fact remains that the value of mortgage, protection, life and general insurance advice has never been so evident.
Focusing on mortgages, a number of homeowners and potential borrowers have suffered from furlough, taken a mortgage payment holiday, had to switch careers, became self-employed or were forced to top up their income from a variety of sources during the pandemic. Any of which may inhibit their borrowing power to a certain degree, especially in the eyes of the mainstream lending community. Thankfully, the continued emergence of a highly competitive and flexible specialist lending marketplace can offer many different types of responsible and innovative solutions to alleviate these concerns.
When it comes to protection and general insurance, this is not always an easy conversation for mortgage intermediaries and it can often be side-stepped, especially when mortgage enquires are flooding through the door. Having said that, good advisers have adapted, learnt from the past and realise that the cross-selling of ancillary products is a ‘must have’ in the modern mortgage market. Meaning that advisers require easy access to a wide-ranging panel of providers with market-leading products, strong service values and efficient tech platforms on which to place business. Relationships that any good network should have in place.
GI is an interesting part of this equation and one which is certainly on my radar following the recent addition of Paymentshield to our panel. Selling GI effectively can generate extra, and regular, commission income in a relatively straightforward manner. Sadly, this is not always seen to be the case. As outlined in a survey from Paymentshield which revealed a ‘guilty gap’ among advisers, with 60% admitting to knowingly overlooking opportunities to sell GI despite 99% agreeing that it’s best practice to do so.
Advisers’ attitudes towards GI are said to have remained practically unchanged from 2020, when 61% of advisers admitted to missing GI opportunities. Similarly, over the last two years, a high proportion of advisers also declared that they “sometimes” or “often” struggle to engage clients in GI conversations (51% in 2020 vs 50% in 2021). One noticeable difference year-on-year was in the number of advisers agreeing or strongly agreeing that their clients want advice on GI – up nearly 10% from 56% in 2020 to 65% in 2021.
This data concurs with a YouGov poll commissioned by Paymentshield at the beginning of 2021, in which 34% of 2,139 consumers said they would be happy for advisers to review their home insurance during a remortgage or product transfer, even though they may not expect them to.
As an industry, we are having to adapt to seismic changes in consumer demand and the value and importance of GI – a product often overlooked in the past – has become increasingly important. From discussions with our advisers, they are always looking for more effective ways to incorporate ancillary business practices into the advice process in order to deliver stronger client outcomes. Simplifying this process and supporting advisers in maximising all revenue streams represents an ongoing challenge for all networks but it is one which we will certainly continue to focus our attention on.
Steve Swyny is commercial director at F4B Network