" They will either go off and do it on their own, or they will go to another adviser to secure it, which leaves the mortgage adviser in a potentially vulnerable position. "
Add in the recent figures from UK Finance on the product transfer sector – which looks likely to add £100bn to overall mortgage gross lending – and you can see why advisers might well be concentrating on the provision of mortgage advice for the foreseeable future.
And yet, this strength does raise some serious questions about customer needs and whether advisers might be neglecting, for instance, protection/GI/other ancillary sales, as they seek to write more and more mortgage business. This was a point raised at the recent FSE London exhibition and it is certainly a pertinent one because the ‘protection gap’ is probably as wide as it has ever been and the need for protection has arguably never been greater.
So, what to do? You cannot force advisers into providing protection advice but you can certainly point out the real positives for any business in doing so. Lest we forget that back when the Credit Crunch hit many advisory firms survived on their ancillary sales, because of the decimation that was wrought on the mortgage market. Without that ability to offer more than just a mortgage, I suspect many firms would have found the situation even harder to deal with.
It was interesting therefore at FSE London that the focus was on how we make it easier for advisers to offer protection advice, while still prioritising the mortgage. Technology was cited as a potential enabler in this and, given the improvement in the tech/systems/processes available to advisers, it should surely not be beyond the realms of possibility to deliver a tech-based solution which covers off, for example, a client’s protection needs.
For what it’s worth, Stonebridge puts great emphasis on the ‘mortgage-plus’ elements of advice and we have long championed and encouraged our advisers to make sure they cover off the GI/protection needs of their client. Let’s be honest here, if the client doesn’t secure protection from the adviser, does this mean they don’t have those needs?
Of course not. The likelihood is that they will either go off and do it on their own, or they will go to another adviser to secure it, which leaves the mortgage adviser in a potentially vulnerable position. If I was that second adviser the first question I would be asking is, “Why didn’t your mortgage adviser sort this for you? Next time I will cover the lot.” Which is likely to mean the client will be lost as the convenience of being able to sort all needs out with one adviser in one place is a compelling argument for many consumers to use someone’s service.
Even if advisers are not using a type of robo protection advice facility, it’s still very simple to set up your CRM system for instance so that the protection opportunity is not overlooked. Many advisers will tell you that, at the point of providing mortgage advice, a larger number of clients are not interested in discussing their protection needs or that it’s not viewed as a priority. And that might well be the case at that point. But it’s not going to be the case through the entire customer journey and it would be remiss of the adviser not to, at least, raise the issue and explore the options for that client.
Again, using your CRM system to ensure that the discussion takes place and that (as a matter of course) details are taken, needs ascertained, and potential products/solutions found, is a simple aspect to any client interaction. In years to come, should that client need to claim on their protection, for example, because they’ve lost their job or had an accident or got sick, then they will be thanking you for that conversation and your encouragement to take out that cover.
For many, many people, that is a potential life-saver and we hear of many clients who would not have taken out protection without an adviser raising the issue. When that situation arises, they are incredibly happy that they took that advice.
So, while the mortgage market might be strong and the temptation might be to concentrate all efforts here, let’s make sure that protection and the like are not neglected. Delivery of advice in this area can be a simple addition to the service, can deliver significant income to the business, and ultimately could be incredibly important to the client should the need arise to claim. That is not something to be sniffed at.
