A new year and it is great to hear that both the economy and housing market are showing signs of recovery. For those astute advisers that have already embedded GI into the advisory process, you are already one step ahead, and opportunities during 2014 will continue to grow.
For those of you yet to build a GI book, or still weighing up the options, then here are a few reasons why GI will still be important in 2014.
Industry commentators have expressed concerns that the good news on mortgage case numbers could have a negative impact on the growth of adviser-related GI sales, and I have to admit I share those fears. Revenue from GI has helped many advisers through what has been a difficult time.
It gave them a chance to keep in touch with their mortgaged clients, to protect and retain relationships, to build new ones, and to demonstrate the extra value that professional advice can deliver. Now that a recovery is looking more likely, this groundwork will pay further dividends.
Continued confidence in the housing market offers opportunities to grow your GI book.
As more people purchase homes they will be looking for buildings insurance, contents insurance, ASU and income protection.
Help to Buy schemes will increase first-time buyer levels, a demographic that certainly needs advice on protection, and likewise further growth in the buy-to-let market will see hot leads for landlords cover. Seize these opportunities by maintaining discipline and focus on GI in 2014.
Providing all-round advice, protecting clients, and building a recurring income for your business should not become any less important as workloads rise, and I urge you to seize ALL of the opportunities that arise from mortgage market growth.
Whilst the economy is looking healthier, a turn-around will not happen overnight. It can take years for any real benefit to filter down to ground level, so the sad reality is that the risk of unemployment is not going to go away in 2014 and a recent survey identified risk of unemployment as the biggest fear we all hold.
It is surprising therefore that much reticence still exists about income protection. A Friends Life Survey in December even suggests that we put our pets before ourselves with only 9% of people taking some form of income protection policy.
Whether it’s an unwillingness to face-up to the fear, ignorance that anything can be done to reduce it, or the result of adverse coverage of past sales practices, too many people remain exposed to one of the biggest threats to their financial health.
As an industry we have a responsibility to confront this issue, so I urge you to make this a priority for this year. Talk to your clients, establish their risks, needs and personal circumstances. How long could they survive on their savings should, through no fault of their own, the worst happen? In this way you could ease their concerns, and help to ensure that an already stressful situation is not made worse by mounting financial worries.
There is more optimism around than we have had for some time, but once the champagne bubbles have burst it is important to take a quick reality check. Reflect on the lesson learnt in 2013 and maintain the good habits adopted. Keep on helping your clients, keep on cross selling, and don’t let your valuable GI income stream fall away.
