REVIEW
PROTECTION
AMI research shows the way forward Kevin Carr CEO and MD, Carr Consulting & Communications
T
he Association of Mortgage Intermediaries (AMI) recently launched its third annual Viewpoint survey on protection insurance as part of the mortgage industry. “The great protection shift” report takes a detailed look at barriers, consumer expectations, communication, perceptions, misconceptions, and more, based on extensive consumer and adviser research. The findings are highly interesting. KEY FINDINGS
One of the standout numbers is that 44 per cent of advisers expect the consumer duty to increase mortgage brokers’ focus on protection. This is astonishing, especially as the cost-ofliving crisis escalates, as affordability is one of the main reasons people don’t currently have protection – cited by over a third of consumers. Regarding cost and keeping policies in force, 37 per cent of advisers are currently “not doing anything” to help customers keep their existing cover in place, preferring to wait until customers contact them, if they do at all. Advisers think all parties, including themselves, should be doing more to promote protection among consumers, while customers still think advisers are mostly motivated by commission. Just half of those consumers with a protection policy are aware of the
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added-value benefits, yet a fifth have used them (these could include virtual GP appointments, expert medical second opinion services, or counselling). Almost a third of consumers mistakenly think they cannot buy income protection if they’re self-employed, rising to 42 per cent among those aged 18 to 34, while two-fifths of consumers think protection cover is always the same whether purchased through an intermediary or directly. And if they were buying protection today, over half of consumers would go online compared to just a quarter who would want to buy it face-to-face – and just three per cent by video. CLAIM STATISTICS
It is getting on to twenty years since protection insurers began regularly publishing claim stats. Back then, we knew most claims were paid – but there were several high-profile declined claims in the media that were giving the industry a very poor reputation, and many policyholders were looking to cancel. Nowadays, over 98 per cent of all protection claims are paid, and the industry has been praised by the media for its transparency. However, over half (56 per cent) of consumers don’t believe claim stats, with this scepticism higher among older people. Are the numbers too good to be true? And more importantly, what more can be done to amplify them? FIVE-POINT PLAN
In terms of outcomes, AMI CEO Robert Sinclair proposes a new five-point plan to “propel the industry forward.” He says advisers need to consider whether they clearly and confidently
MORTGAGE INTRODUCER DECEMBER 2022
articulate the value of protection advice to consumers and that firms need to consider their approach to protection, considering consumer duty. For advisers who don’t want to write protection, there are many today who can provide services to act as their protection adviser in a way that suits all parties. For insurers, AMI want improvements in service in which providers commit to working with advisers to understand the pain points and address them where possible. In addition, we need to make far better use of claim statistics and work with industry bodies to tackle the barriers highlighted. As AMI chair Andrew Montlake notes, “We have to accept that it’s time to evolve, and to look at things differently.” NEWS ROUND-UP
Paradigm Protect has announced a partnership with Assured Futures, which sees the firm providing signposting options for Paradigm members. According to research by LV=, 60 per cent of surveyed 25-to-44year-olds who don’t have pro- tection in place would feel more “financially resilient” if they were covered; research among 4,000 surveyed UK adults found that while 12 per cent of respondents have income protection provided by their employers, 26 per cent of surveyed adults who don’t have a group or individual policy would like to have one. Guardian has partnered with UnderwriteMe on its IFA protection portal. Aviva has made improvements to its Core and Upgraded Critical Illness plans. M I www.mortgageintroducer.com