Should you refuse a mortgage without protection?

National Account Manager for Protection Craig Bryce looks at how much of a priority protection takes in client conversations, and how providers are helping advisers change the record.

When speaking at a round table event last year, some advisers were shocked to hear that I had known advisers to refuse to do a client’s mortgage unless they took out protection. It seems the priority that advisers give to protection sales can vary, to say the least.

This was also covered in the press recently, which suggests this is more prevalent an issue than people might think. I would not suggest that refusing a client because they have no protection should always be the case, but as National Account Manager for Protection, I like that the idea at least makes us think about the importance of cover when taking out a mortgage.

Protection priorities

When a lender offers a mortgage to a client, they do so on the basis that the client has taken out buildings insurance to cover the house should anything happen to it. But what about the means to pay the mortgage, should this not take as much precedence?

The main thing to protect against is anything that would prevent the borrower from making the regular payments, such as accident, sickness, unemployment, or death. There are protection options for all of these, yet statistics show clients are more likely to protect against the unlikeliest events, such as death.

Changing the protection record

A great way to get people thinking about insuring themselves for more than death, is to talk about how we take out protection for our home. As an example, it is common to use boiler cover, to ensure something so important is fixed quickly.

But what if we had a machine in our home that earned us enough money to pay our mortgage and bills? Would we insure it? The reality is yes we would, and yet clients hesitate and look for reasons not to protect their income and the ability to pay the mortgage.

Keeping their protection options open

In my experience, there has never been a better time in the protection market for product options and additional benefits. Providers have really made some incredible enhancements to their proposition in the past few years, which makes selling protection to clients much easier for advisers.

As National Account Manager for Protection, I sit down with advisers and go through their sales process, to ensure they are doing what they can to break down client objections and improve their sales where possible.

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