In episode 65 of the Growth Series podcast, Andy Walton, Protection Proposition Director at Mortgage Advice Bureau, discusses protection for mortgages with Rob Brookes, Senior Mortgage and Protection Adviser and Director.
The pair talk about what protection is, how many people take up this option and how brokers can use it to help support their customers’ needs.
Rob says protection is another word for insurance, so people can be prepared for drastic changes in their circumstances, such as a long-term illness or their house burning down. He states that with protection products such as life insurance, critical illness income protection and building and contents insurance, people won’t be forced into making financial choices they wouldn’t otherwise wish to make.
Andy asks Rob how he positions protection with customers, and Rob says it’s held up as an integral part of the process from the beginning. Since customers may not want to talk about insurance while they’re taking out a mortgage, Rob lets them know the features and benefits early on, and aims to make them understand the importance of being protected.
He states that by talking about protection straight away, rather than taking it on at the end of the process, customers are often more receptive to having cover and getting the protection they need.
As Rob points out, you don’t buy a car without considering the need to insure it, so it’s only right that you get insurance for a house and the debt that goes with it.
The conversation then turns to if there are any differences for customers who are remortgaging. Rob says the approach is the same, so if a mortgage is reviewed, the protection is reviewed too.
Remortgages usually come with a change of circumstances, such as a new job or having children, he states, in which case new and additional protection may be needed.
Andy and Rob then discuss how many people are taking out protection when they’re getting a mortgage. Rob believes about three-quarters of mortgages written by his advisors have protection alongside it, but he wishes it was more.
This, he says, is why he often gives examples to customers of why it is so important, as he’s previously seen customers deal with life-changing circumstances without having taken out protection.
Rob also notes that about 50 per cent of remortgage customers get protection, but he stresses that this may be because they have some suitable protection in place already.
Interestingly, Rob feels the pandemic has made more people realise the need to get protection, as Covid has made many consider their health, wellbeing and security of income.
Andy and Rob then discuss establishing a budget with a client. Rob says it’s important to do this early on, so the customer has a rough idea of the cost and is happy with it. However, he tells Andy that he makes sure customers are aware of more expensive policies, as cheaper options don’t provide the same level of protection.
This, he says, means the client is in a position to say no, and it’s their responsibility if they’re not adequately protected.
Finally, Andy asks Rob whether protection is reviewed further down the line, and Rob confirms that his advisors have regular calls with customers post-completion, and then every year after that. Rob uses various tools to demonstrate the need for certain types of protection with customers, and is happy to speak to people remotely via Zoom, as this can help him show them what he believes is best for them, better than a phone conversation.
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1:25 to 44:05
Introduction to guest
What is protection?
How are customers made aware of this option?
Differences for people who are remortgaging
Has Covid changed people’s attitude to protection?
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