So with all this positivity flying around, why does it feel that something’s missing?
During the post-crisis stagnation of the housing market when mortgage sales were slow, brokers increased their focus on protection products.
However, now that the housing market is rebounding, that focus has moved to mortgages. BUT, the client’s need has not moved. At a recent industry summit, 41 industry experts were asked what the biggest barriers to brokers selling protection products were, and 85% cited broker apathy in their top three answers.
A clear shift in attitude is needed, with brokers moving away from viewing protection products as just a supplementary revenue stream. They need to be seen as a moral obligation to the customer.
For example, a newly-wed couple looking to buy their first home is unlikely to have protection insurance at the top of their priorities. But it is still an important product, especially for those about to commit to a significant financial obligation. For many, it will be their mortgage broker who suggests this additional safety net, which could change their life for the better later on down the line.
Building strong relationships and providing a holistic service, is a good business strategy, with customers more likely to recommend you to their friends and family. Brokers talk about the customer being ‘their’ customer, but does the customer feel the same?
Are you just a means to an end (in this case the best mortgage deal) or do customers view you as their trusted adviser? The most powerful recommendation a client will give will be when they’ve been able to keep their home, due to your advice, when they’ve suffered a loss of income. Do you want to be the recipient of the worst type of word of mouth when something goes wrong – that of the adviser who didn’t advise?
As the wheels of the housing market start turning again protection sales must not slip off the radar. Not only can brokers create a further revenue stream from this product range, but they have an ethical responsibility to their customers to make sure they are aware of them. A change in how protection sales are viewed, both from brokers’ and customers’ perspectives is needed if we want to stop there being something missing.
Jeremy Duncombe is director of Legal & General Mortgage Club
