Angela Davidson | May 18, 2021 | 3 min read

Free cover: the moment of truth

Free cover during application or underwriting is something that most providers offer for life, critical illness and income protection policies. But this feature often goes unappreciated, with many clients and advisers not realising just how beneficial free cover can be. So, we asked our head of protection, Angela Davidson, to share her memory of a time free cover truly came into its own:

“Several years ago, when I was working in Business Development for Royal London, I received a phone call from one of my advisers who was really distressed. As it turned out, he was upset because he had just called his client to ask if they had a date yet for signing contracts, so he could put their life and critical illness policy on risk the same day. In theory, it should have been a routine phone call and a chance to congratulate the client on their successful house purchase. 

However, on the phone the client revealed that he had suffered a stroke a few days earlier. Obviously, this was the reason the adviser was so distressed. The client still wanted to be protected and was unsure how the stroke, or any consequential issues, would impact his ability to work. The adviser knew he would have to inform Royal London about the stroke and, as a result, they would likely withdraw the terms. It was also very unlikely that other providers would offer cover, at least for a significant period of time. 

Thankfully, I knew Royal London offered free cover during application, which the adviser had forgotten about. So, because the adviser had arranged the client’s protection at the same time as his mortgage and submitted the protection application in readiness for the mortgage completion, the client could claim on the policy. As a result, the client moved into the house completely mortgage free! Even though the policy had never gone on risk and the client hadn’t paid a single penny towards the policy.

Safe to say, both the adviser, and his client, were delighted. The adviser may not have received any commission or a proc fee because the policy never went on risk, but he walked away from that situation with a fantastic reputation and gained near ‘hero’ status amongst his fellow advisers.  

Although the provider’s free cover allowed the client to receive a pay out, ultimately, it was the adviser handling the client’s protection and mortgage at the same time that meant the client could make use of the free cover. The situation could have played out completely differently had the adviser left the protection to a later date to sort out, that wouldn’t have been a happy ending. Safe to say, it’s so important to talk about protection and mortgages together, always. You never know what may happen tomorrow.”

Currently, the majority of providers on our panel offer free cover during either application, underwriting or both. However, it would be wise to check that the provider you have in mind does offer this very valuable option. If you’d like to know about the free cover offered in more detail, speak to our broker support team today at 0345 130 7446.