Archive: May 2015

Mortgage Intelligence launches virtual training events and workshops

Mortgage Intelligence has launched Mortgage Intelligence Online, a series of virtual training events and workshops offering members on-demand access to training and business development support without the need to leave the office.

Commenting Sally Laker, Managing Director at Mortgage Intelligence, says:

“We are very proud of the services we offer advisers and always strive to provide our members with the most flexible and comprehensive support package available. Hosting virtual events has helped so many advisers to broaden their knowledge of the industry, as well as providing professional advice on how to better serve their clients and grow their business.”

The 2015 programme is packed full of great events hosted by leading lenders, providers and selected business partners. Mortgage Intelligence want to give its members the tools and advice they need to stay ahead of the game and continue to provide the same first-class service to their clients.

“It’s an excellent way to communicate and learn,” said Chris Pownall, at Regency Mortgage Services. When asked 95% of our advisers said it’s a great way to learn often technical industry and business knowledge and a great way to interact with their peers.

Upcoming Events

New Build – A Market of Opportunity
Presented by Adrian Moloney – Corporate Account Manager at Nationwide
Wednesday 6th May at 10.30am

“We will be exploring opportunities in the New Build sector with focus on the current market, economic trends, areas of opportunity and the future of the New Build market. The session will also look at Help to Buy, affordable housing and the upcoming Starter Home Initiatives, all key sectors of the intermediary market. This is an excellent opportunity to enhance your knowledge of a growing area of the UK mortgage market from one of the leading lenders in this sector.”

Register Online

Trusts: What, Where, When and Why!
Presented by Darren Phillips – Strategic Account Manager at AIG
Wednesday 13th May at 10.30am

“The presentation intends to provide a general overview of the benefits of putting life insurance into trust, potential disadvantages of creating a trust, a guide to the types of trust available and responsibilities of the parties involved. It will also go through a couple of examples of putting a policy into trust, provide some practicalities around the online trust system as well as cover most common trust queries.”

Register Online

Mythbusting Income Protection

The protection gap in the UK remains a mystery to many experts, as consumers continue to prioritise their spending on short-term luxuries such as quickly-outdated technology and costly TV subscriptions. More worryingly, a study from a top provider in the UK suggests that 5.2m mortgage holders who earn an income have no protection cover, or even a plan to get one, to cover their repayments if they become too ill to earn.

It is therefore up to advisers to educate clients on how smart Income Protection cover is. We want to help you mend the protection gap by providing you with the tools to break down the barriers created by assumptions and misinformation.

Here is an overview of three of the most damaging myths surrounding Income Protection and the most effective fact-based weapons to use against them:

Myth 1: It’s expensive…

Income Protection is still one of the most affordable forms of protection and boasts some of the lowest premiums in the industry. As well as affordable, it is also one of the most widely suitable to consumers, who wish to ensure long term sickness won’t cause damaging financial detriment.

Use life and budget planners to show how much your client is spending every month. In most cases, it will dwarf the cost of Income Protection. People are often surprised by the low expenditure of Income Protection policies, so it is worth showing how little it can cost for that peace of mind.

Grabbing the opportunity to talk to clients about the cost of protection is invaluable. A survey by YouGov revealed that the majority of consumers admitted they would turn first to state and charity for support, before seeking financial advice. But the financial support from state and charity would likely only be enough to cover some major payments, let alone bills, food and other necessities.

Myth 2: It’s unreliable…

Despite many providers proudly announcing healthy payout levels, the myth that providers regularly don’t pay on claims prevails. Kevin Carr, chief executive of Protection Review, says: ‘The reality is that over 90 per cent of all claims […] in the UK are paid promptly and without fuss’, with most unpaid claims due to unmet criteria. The PPI scandals in recent years have also not helped matters. Unfortunately, some consumers continue to group Income Protection with PPI, when the two types of insurance are markedly different.

Ensuring your client fully understands how to get the most out of Income Protection is also crucial to its perceived reliability. Choosing a longer deferred period for example can reduce the premiums, especially useful if the employer would provide cover up to that point.

Myth 3: It’s unnecessary…

We have Protection Toolkits on Broker Zone to get clients thinking about the necessity of Income Protection by asking three important questions:

In the event of long term absence from work, how long would your employer pay your full salary?

Some people wrongly assume their employer would continue to pay them full salary for as long as they are absent. But many employers would only pay full salary for up to six months’ absence and are only legally obliged to pay statutory sick pay for up to 28 weeks.

Would you cope on state support?

Currently as little as £57.35 a week, state support would quickly be insufficient to prevent savings being dug into. Despite this, many consumers still harbour the belief that the state would adequately support them during financial detriment.

The process of claiming state support is also surprisingly arduous and entails completing lengthy and complicated documents; something your client could do without during the stress of long term illness.

How long would your savings last if you were unable to pay the bills or mortgage?

We just don’t save enough as a nation, which means for a large number of people savings would not last long if used to support their lifestyle in the event of long term absence. Remind your client how hard they have worked to build up any savings and how stressful it could be to see them dwindle away.

Staying Safe with Social Media

The FCA recognise that social media marketing is an area of your business that will only continue to grow in the coming years. Their newest guidelines on how to use social media for financial promotions reflects their supervisory approach, which allows advisers to stay compliant whilst enjoying the benefits.

Head of Compliance Stephen Adams has a quick guide to the new document, to help you get a better understanding of how to use social media safely:

What are the guidelines?

The FCA have stated that the definition of a financial promotion within social media is: “An invitation or inducement to engage in financial activity.” This is a key definition and one that applies across all communications. The FCA states that “there are requirements to include risk warnings or other statements in promotions for certain products/services. These rules are media-neutral and therefore apply to social media as they would to any other medium.”

The FCA are also keen to highlight that: “The requirements to be fair and not misleading imply balance in how financial products and services are promoted, so that consumers have an appreciation not only of the potential benefits but also of any relevant risks.” This is an important clarification which ensures that the restrictive nature of social media does not excuse firms from displaying the associated financial risks.

The two most important questions to ask before posting are: Is this a financial promotion according to the FCA guidelines? Am I able to display and balance the potential risks within the communication?

What about word and character limits?

The guidelines have been the subject of some debate between the industry and the FCA, with much of the discussion surrounding the limits and brevity of social media posting, potentially making it difficult to fully comply with regulations in just a small piece of content. The FCA has therefore suggested that firms’ use of word-restricted channels should be limited and not used if promoting a complex feature or service. If you do decide to use it, then you still have the responsibility to ensure it contains the minimum amount of information required.

To help with character limits, the FCA have suggested: “It may be possible to signpost a product or service with a link to more comprehensive information, provided that the promotion remains compliant in itself.” In other words, make sure that you are only promoting financially when all the associated risks are displayed on the communication, otherwise it must remain neutral as an advertisement.

What about sharing, liking and forwarding content?

To know when sharing, liking or forwarding a communication is compliant, check whether it originated from a customer or another FCA regulated firm. Although it is always the responsibility of the original communicator to ensure the post is compliant, the FCA does insist that when “a firm re-tweets a customer’s tweet, the firm is responsible as the communicator, even though the firm did not generate the content of the communication”. The FCA also maintains that: “Firms should ensure that their original communication would remain fair, clear and not misleading, even if it ends up in front of a non-intended recipient”.

What about using images?

Using images to promote is very popular on social media, but you still have a responsibility to ensure that your visual communication is not just compliant, but fully responsive on all devices such as phones and tablets.

If images contain a tagline that directly calls the consumer to action, such as “come and see us” or “save money here”, then they must also display the associated risks. If not, then it must remain solely as a visual advertisement.

When should you be careful?

Firms regulated by the FCA must be careful at all times when using Social media. The FCA also reminds firms “of their obligation to have an adequate system in place to sign off digital media communications.” Sign-off of social media communications should always be a person of appropriate competence and seniority.

Please remember, this is only a guide! So be sure to read the full FCA Guidelines to ensure you are up to speed on the latest on how to safely use social media. We also recommend contacting social media specialists Social Advisers through the Broker Zone website.