And now, with the Covid-19 pandemic making people more aware of their own mortality and the reality of how their lives can change unexpectedly, discussions around preparing for worst case scenarios have become part of the everyday conversation.
So this week, Mortgage Solutions is asking: Has the pandemic changed the way you advise on protection?
We already position protection quite early on in the conversation.
I do find clients are more receptive in terms of having the time to think about it because people are working from home and have longer to converse about something personal rather than allocating time to come to our office. And, there is an element of fear as people are scared of Covid-19 and its potentially fatal consequences.
We’ve had people just call us up saying they have been thinking of life cover and critical illness asking to do a quote, even when it’s not mortgage related.
During the mortgage process, I think they just assume it’s part of the process compared to before where they were a little bit reluctant to discuss it.
Everything related to protection including private healthcare has become more prevalent to people because the NHS is under strain, so people want to consider those options.
Also, where people are working from home and not spending on travel, they have more disposable income to spend in this area.
Protection can be easier for mortgage advisers to bring up now because often they can be reluctant to talk about it as it’s a sensitive area. The dynamics of advice change. With mortgages, the client needs you. With protection you are selling a concept.
The problem with sole mortgage advisers is protection can become a secondary conversation. But they aren’t looking at it as a two-step conversation anymore, they are looking at it as one process.
Advisers are also mindful of the future. If mortgage business and applications decrease, they are getting wiser with holistic advising and thinking they have to encapsulate what they can because we don’t know what’s ahead of us.
On a practical level, where advisers aren’t doing face–to–face meetings or seeing business development managers, they can take the time to talk about these things more.
We bring it up very early on in the fact find. We don’t just talk to the client about mortgages, we make it very clear that we are looking at a fully protected mortgage.
It’s important we address things very early on. If we left things and then looked at protection later, it can cause complications and delays in the application process.
Everyone knows someone who’s been affected by Covid-19 and knows what impact it had so clients are more receptive to speaking about protection.
There are a lot more questions that need to be asked now too.
As soon as we had the first lockdown and realised the impact of Covid-19, we changed some of the questions we ask during the fact find immediately to fall in line with that. We didn’t delay. Our clients are prepared and we prep them very early on in every stage.
Protection questionnaires are comprehensive so we’ve tried to engineer our questions to be in line with what insurance providers would ask.
Advisers have a duty to bring protection up from the start, pandemic or no pandemic. We’ve always looks at fully protected mortgages from the outset, so our way of working hasn’t changed.
In terms of other brokers, they have a duty if they want to class themselves as fully compliant mortgage and protection advisers and they should bring it up early in the journey.
Covid-19 shouldn’t be the factor for it, they should already be doing it.
As we grow older, get married, build families and start businesses, we come to realise more and more that life insurance is a fundamental part of having a sound financial plan.
Depending on your type of policy, life insurance is fairly cheap, which means there’s no excuse not to get coverage now. Plus, over the years, you’ll find comfort in knowing money will be available to protect your loved ones in the event of your passing.
We have always discussed the importance and cost of types of life cover at a very early stage when arranging our clients’ mortgage.
All our advisors ensure they ask the relevant questions at the fact finding stage in order to obtain a clearer financial and cover in place.
In the vast majority of cases, our clients main concern is to obtain a mortgage offer but it’s our duty and reasonability that we provide our clients with relevant life cover and protection quotes in order to ensure they and their families are supported in any circumstance.