As an adviser, it’s your responsibility to have those difficult conversations with your customers when making them aware of all the different policies they have available to them. One such policy your customers may not be aware of, but definitely should be, is income protection insurance. With a name that is fairly easy-to-grasp it won’t take long for your customers to piece together exactly what income protection is once they hear it, but it is still absolutely essential that they are educated on its numerous benefits. In the event that your customer calls you up to inform you that they are unable to work and are therefore unable to continue earning their income, you don’t want to be left feeling like you could have done more to ensure they were protected in the event of something like this. So the next time you sit down with your customers, present them with all the facts when it comes to Income Protection.
If you’re looking for some more information around some of the other types of protection there are which you are interested in making a larger part of your proposition, then we recommend having a read of our articles. Learn all about the major protection types your customers want to hear about including:
Is Income Protection Worth Selling?
Income Protection is a policy that can often be overlooked by advisers, as well as customers for many reasons. But with the upcoming industry shake-up following the implementation of the Consumer Duty Act, it has never been more important to make sure your customers are cared for and supported, which means making sure they are aware of all the different policy types available to them. While your customers may not want to confront the idea of being unable to work due to a serious illness or injury, it is a reality that unfortunately they may have to face one day. And in the event your customer is left unable to work in the event of a serious illness or injury, you will be able to rest easy knowing you have arranged a policy that effectively clears them of any major financial stress so that they can focus on getting better and living comfortably in a lifestyle they are accustomed to.
The key principle of the Consumer Duty Act is providing “good consumer outcomes” and policies like Income Protection deliver exactly this. Income Protection could provide your customers with a monthly payment which covers a percentage of their income, which will go towards mortgage payments, household upkeep, medical expenses, food shopping and more, all of which are essential to your customers. So why is it that Income Protection itself isn’t seen as essential?
Why Aren’t Customers Buying Income Protection?
Following a recent survey of 3000 people in the UK, research shows just 6% of the British public have actually taken out an Income Protection policy with their adviser, despite over 50% believing the insurance to be important. So if you have reservations about bringing the policy up to your client because you’ve been unsuccessful in the past, just know it’s not your fault. In fact, odds are you’ve probably heard one of the following responses…
- “Insurers don’t pay out”
- “I’ve got Critical Illness Cover”
- “I can’t afford Income Protection”
- “My savings will cover me for a while”
While some customers may be steadfast with their view that this protection policy isn’t for them, others may be more flexible, and it’s up to you to communicate what benefits Income Protection will offer. With as many as 8 in 10 UK households concerned about at least one issue affecting their ability to work, customers are clearly willing to listen if it means putting their worries to rest. Getting across that relying on their savings or their sick pay benefits from employers will simply not be enough to sustain their lifestyle long-term is perhaps the most essential facet of selling income protection policies. So during your next sit-down conversation make sure you show you understand why your customers may not feel taking out an Income Protection policy is worth it, but at the same time stress the fact that their current reservations can all be put to rest with the right policy, arranged by you.
Income Protection Insurance for the Self-Employed
The added complexity of a customer identifying as self-employed makes arranging a policy less straightforward than if they were in full-time employment. However, it is your duty to ensure your customer has a reasonable understanding of the policy, so that they can decide for themselves if it is for them or not. In fact, in some ways it is more important that you take into account the protection needs of your self-employed customers because of the lack of statutory sick pay for these types of employees. As of May 2023, there are 4.39 million self-employed workers who could benefit from Income Protection insurance in the event they are ill or injured, and it’s imperative that every one of them understands what options they have available to them.
Get in Contact with our Panel
Here at PRIMIS, we want all advisers and brokers within our network to have access to the best possible panel of lenders, so that you can find and provide your customers with the most appropriate policy. Have a browse of our full list of lenders offering Income Protection
- The Exeter
- British Friendly
- Cirencester Friendly
- Holloway Friendly
- Legal & General
- Royal London
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