Hardly the best environment for a mortgage broker to operate in, you might think.
But, while today’s market is nowhere near the heady days of 2007, with lenders bullish when offering credit, it does present some interesting sales opportunities for the mortgage broker.
In uncertain times, people seek reassurance and one of the ways they can find this is by protecting their finances.
Yet, Sainsbury’s Life Insurance recently suggested that only 43% of mortgages are protected by life cover. At Connells Group, we promote the concept of a fully protected mortgage to ensure our clients have the opportunity to protect the roof over their head. How many of us could afford our current lifestyle if we couldn’t work?
This is where life cover, income protection and critical illness cover can prevent health issues becoming wealth issues too.
It’s understandable that, with finances stretched when people first buy their home, they may not be able to cover all eventualities.
However, the current economic climate creates a great opportunity for you to revisit your client bank, reviewing their protection and financial needs and showing them how little it can cost to protect themselves, their homes and families.
Life cover for all those in relationships or with dependants is an obvious need, while income protection could help ensure customers can continue to meet their mortgage repayments when unemployed or off work due to ill-health.
Critical Illness Cover premiums might have been too expensive for customers a few years ago, but with interest rates low and reducing state help to pay the mortgage of those too ill to work, customers might be more interested now.
Those same customers might also be interested in fixing mortgage repayments, given the better-than-expected economic data which has led some industry commentators to speculate that interest rates might rise earlier than previously predicted. Clearly, this will depend on the client’s specific circumstances.
Despite the evident need for borrowers to better protect their finances, the old adage that ‘insurance is sold rather than bought’ still holds true.
Now is the time to dust down your client bank, get in touch and make sure that if your client hits hard times, you have provided the financial cushion they need to survive them.
Charles Haresnape, group mortgage services director, Connells
