Adam Higgs: Have we gone too far in terms of the sheer number of products available? Or is it a case that we might not have gone far enough?

Scott Taylor-Barr: How do you make sense of it? You assume I make sense of it. I think that it is a very big list. And at the moment… I use Solution Builder? So that’s the system that I use. So you do get a very big, long list and it is very reliant, the process at the moment, on the adviser’s knowledge of knowing, “OK, which of these insurers includes children’s cover, which is a great example and which ones is an optional extra? When it’s an optional extra, is it one premium covers all the kids or is it a premium for each individual child?”

So we’ve got things like fracture cover, which is another one that’s crept up on things. You’ve got people who take IP with LV=, for example, includes fracture cover, but with others it’s a cost option. So when you’re looking at that list and you’re going, “right, okay, then fracture cover is important to this client– I’ve got to add £8 to that Zurich quote to include the fracture cover, whereas the LV one’s already got it included” and they’re just two examples.

Then, as you say, you’ve got enhanced or upgraded or extra or select, depending on the insurer that you’re dealing with and what they want to call it. And it very, very quickly becomes a very, very big, long list because there’s multiple options there. Then you’ve got things like global treatment and you’ve got stuff that’s quite bespoke to individual insurers where there’s maybe not a similarity across the piece. I think what it really comes down to is should there be less choice? Probably not.

I think a good range of products is great. I think the issue is maybe more around, dare I say, the sourcing of those, and maybe having a system that’s got more options to allow us to include things upfront.

So when I’m doing that initial quote and I can have a conversation with the client, I’ve got a whole bunch of extra tick boxes so I can say, “all right, fracture curve is important. Let’s tick that box,” so that the results that come back to me have already filtered out those that haven’t got fracture cover or included it as the add on for those that need it doing that way. Same with children’s cover.

Admittedly, there’s always going to be those oddities. I mean, global treatment, for example, where it’s a very small group of lenders who are going to do that and you wouldn’t want to spend the money sorting out your sourcing system to do that. But there’s plenty that are growing now across the market where there’s a whole bunch of insurers who offer them. And I think it would be really handy from a broker’s point of view, or an adviser’s point of view to have those options up front as part of the sourcing, as opposed to having to look at the results and then try and work it out from the results.

I’d rather have it at the front end, or I could have the conversation, tick the boxes so that I’m getting a more robust set of results at the end that I can then talk to the client about.

Adam Higgs: Lee, from the business protection side, is the range of products what it needs to be or should there be more ability to tailor products for different businesses?

Lee Thomas: I’ve got two sides to this. If you look at things like critical illness, when you’re talking business protection, actually things like additional payments and fracture cover and all that other stuff isn’t really a concern more often than not, most businesses are thinking about impact. So they’re thinking, “I’m worried about this person not being around for a year because that’s where the business is going to struggle.” So the fact I’m going to get 25 percent of a claim because he’s broken a toenail but he’s not going to be off work, isn’t really something that the business owners are particularly concerned about.

So actually, sometimes all that fight for covering as many additional payments and all the other bits and pieces don’t really factor in. They’re thinking about the big impact, if the guy is taken out he or she isn’t here– it’s going to be a cost to the business. So in that respect, sometimes some of the stuff that when you’re trying to talk to an individual personal client and you’re trying to make sure in a sense that they’ve got maybe as many options as possible and as much chance as possible of claiming for things that can impact them on a personal basis… I don’t think there’s the same impact necessarily there from a business perspective. So sometimes you’re stripping away a lot of that stuff and thinking “that’s unimportant. I just want the big ticket stuff.”

But then on the flip side of that, I think there’s some real gaps in the products that you need for business protection. Because all too often, I think business protection is simply insurers looking at what they do for personal cover and then they saying, “Oh, and we’ll just call that Key Man because the business is paying for it” or they’ll attach a trust to it, and all of a sudden it’s shareholder protection. And I don’t think there’s been enough evolution of products that are fit for purpose to make them truly business protection products.

I can give you a couple of examples on that. So if you take shareholder protection: if you look at a decent shareholder agreement, if you look at articles of association, you will often see in there that there is reference to not just life only, but permanent incapacity. And ‘permanent incapacity’ can mean that someone loses their directorship and that they can be really put under an obligation to sell their shares.

So when I’m talking shareholder protection to clients, I have a talk to them normally and just in terms of what’s available in the market on a life-only basis or critical illness basis. The problem with critical illness insurance and shareholder insurance is if you were to claim on it, there’s a good chance you might claim on it, but not be in a position where you need to trigger the sale of your shares.

So you almost need something that sits in the middle. The nearest at the moment, I think, is probably Vitality’s Disability Cover for Business. With that one, what you want is a policy that strips out all the things that you might be able to claim on a critical illness policy that don’t necessarily mean that there’s a long-term impact in terms of that person’s ability to return to work. So for shareholder insurance, you’re looking for just the conditions that would permanently incapacitate someone.

You almost need like a life and a very robust TPD policy, so it’s more to do with impact rather than conditions. And often the shareholder agreements will refer to define by permanent incapacity or more than three years incapacity, and they say “at that point, this person is going to want to sell their shares.” And then you don’t want a policy that’s going to pay out when you don’t need it because it’s then sitting in a trust and no one knows what to do with it, and “do we hold onto it in case he dies?” And it creates more of a mess.

And then you look at the pricing of that. Hopefully what you’d find is I’ve always hoped for a sort of life and TPD policy that are priced somewhere between halfway between life and life and CIC. Whereas if I look at the Vitality Business Disability cover at the moment, the price is at about 91% of the next full critical illness policy. So then you’re saying to a client, “Okay, this is maybe relevant, but for nine percent more, you’ve got all these extra conditions.”

I don’t think there’s a product right for shareholder protection yet. So that’s one thing. Also, I don’t think many insurers do Joint Life Second Death for shareholder protection, which is often the case when you see husbands and wives in joint businesses and stuff, and sometimes you need a policy that does that, and very few seem to do that.

So actually, there’s not enough I think, in the market that are actually fit for what’s called ‘shareholder protection.’ I think it’s just a personal policy with a business trust and people go, “there you go, you’ve got your shareholder protection.”

Key Person, again, they’re just looking for the big impact. I like Aegon’s and Legal & General’s income protection Key Person policy, but I think to some degree it’s almost too restrictive in terms of how you work out the maximum benefit they can claim, and it doesn’t include things like life. So you’re having to add a life policy on top of the Key Person income protection because again, if you’re looking at Key Person income protection, it’s because he’s not there.

So you would almost want life as one of the conditions because it’s the same impact to the business. It’s very different from income protection. So that’s some of my thoughts and like I say, just really robust TPD. I think a robust life in TPD, something that is impact-driven rather than condition-driven for businesses, because that’s all they’re focused on: He’s not here.

Adam Higgs: It’s a really interesting point because the TPD definition is almost solely reliant on that ‘permanence’ word but having spoken to our doctors, it’s really difficult for doctors to say a lot of conditions are going to be permanent. It’s a little bit similar to a terminal illness where doctors are often quite reluctant to say you’re going to have less than 12 months.

Lee Thomas: You would make it like a long-term incapacity, and you judge that three, five years, whatever at that point, absolutely, that person is probably going to trigger a sale of their shares. And so it wouldn’t just be life with the current TPD, because again, if you look at TPD more often than not, I imagine most things that would lead to a TPD claim are actually going to be claimed under the condition rather than under the TPD. So you almost need someone to go, “okay, what conditions would probably be claimed on a TPD or a long term incapacity basis?” And look at that as a product. And like I said, I think it almost needs to be sort of impact-led rather than just ‘how many conditions can we get on this policy?’

Adam Higgs: At Openwork you have a panel but there is still a lot of variation—how do you help your advisers cut through that?

Setul Mehta: It’s still pretty comprehensive– maybe not quite 80, but it still counts in the comprehensive camp. In my mind, I think there are three types of advisers, which is where I start. So you’ve got your inexperienced or new to financial services advisers. You’ve then got your experienced advisers, but not quite comprehensive in their knowledge in terms of all the different areas and the nuances that exist. And then you’ve got what I would call your experienced and your comprehensive– so they get it, they understand it, they’re not just protection advocates, but this is what they do day in, day out.

And so therefore, you think about those three categories, you’ve got your protection advocates and again, then you’ve got your other lot, which is sort of busy advisers, whatever space they operate in, whether it’s mortgage or wealth or protection, but actually, they view protection as a bolt-on. And that sounds really negative, but I don’t mean it. I can’t think of a better word than bolt-on. They do still have the protection conversation.

So then when I dilute that further says to me, you’ve got individuals which will always just go for the cheapest because it’s easy, it’s quick in theory, it’s top of the list. Even if it’s a budget sale, if you’re new and inexperienced and you haven’t spent the time or you’re really busy, that’s the one you’ll go for. And actually, they’ll always end up going for the top until they start to spend a bit more time trying to understand the space and understand the various options available. And you’d hope that would come with time because they’ll start to see the benefit and the value of not just going with the one that’s at the top.

I think then you get those individuals that do go through the array of options available, but if you think about my categories earlier, I’m going to I’m going to use the word pick but I don’t mean it in that way again, Vitality can be comprehensive, and therefore not everybody gets it, but those who get it get it really well and see more claims than probably in the other areas.

Those who think about Guardian’s Dual Life will never be top of the list, and those who get the Dual Life option really get it and will never go top of the list because they understand the benefit and the value. But you’ve got individuals then, which almost it doesn’t matter what’s top of the list, but they will tune out certain scenarios and then we look at how can we try and help and support those areas? You then have got those individuals that are driven by the support available and that then for me, becomes a mechanised process.

So I can’t remember who said it earlier, maybe it was Scott, but you have got Solution Builder there where you start to tick some of the boxes and allow you to do the variations. And you’ve got individuals who understand, but then actually start to think about a client’s genuine needs and go that thorough element and then next layer down in the process. And they can have the robust conversation because they understand the different variations available. I think I would struggle with somebody who would understand all 80 because it just feels like that is an impossible task.

But if they know where to go to because they’ve got that engagement and discussion with the providers, then they’ll be in a better place. So for me, what have we then done to help? Again, smaller panel, but still variations exist. So we’ve got a document that outlines the variations available. And obviously, it’s easier when you open that up, but it’s still a robust list and it’s still a big document that talks to you about the various options.

We’ve then, because we use Solution Builder, we’ve then worked with our iPipeline and we did a session I think it was earlier this year, where we asked them to deliver the, “why didn’t you tell me about this before?” So we’ll often, those advisers who actually start to get involved a bit more, when they talk to my iPipeline or others say, “Can you do this?” And Solution Builder will turn around and say, “Yeah, we can do this.” That session was really, really useful because it then allowed you to try and help you to distinguish and dissect some of the other options. And then you start with those areas a bit like how Scott was talking about earlier.

So for me, ultimately, I guess in answering your question, you’ve got lots of different variants. It doesn’t matter whether you’re a reduced panel or your whole of markets and support, it’s all about how can you make life easier? And it starts with trying to make sure the options are available, the collateral is available, you try and find ways to distil it for the adviser, you engage with the providers, and if you run a network, you’ve got options available.

Do I think we should have less? Probably not, because if I think about, we had a claim last week and I think it was an LV=, where it was an NHS worker who was claiming after the six months and they had a reduced pay-out. Well, not all of the IP providers would ever support that nuance of individual.

Of course, the flip side is, can you try and protect every single nuance? Unfortunately, and I don’t again don’t mean that in a negative way, there’ve been so many variations of claims that have been available and people have actually got money as a result of it, you sort of think, well, if it was distilled further and you were going to lose out with some of the variations, then you wouldn’t get the pay-outs and clients wouldn’t be able to continue to live the lives we all want them to live.

And in terms of what else we could have, Lee just made me think really, and it’s been a few years since I’ve been involved in the group market. But I don’t know if the group market has sourcing in the same way as some of the other areas. So, is there sourcing available for group IP to make those individuals who get involved in whole of market group IP available? I have no idea, you might say yes there is, but I think sourcing… imagine if we didn’t have sourcing tools, how much worse that would be for advisers.

Anna Glod: So my name is Anna Glod, Umbrella Protect. First of all, do I think that there are too many products and too many variations? No, definitely not. I very much agree with Setul. I really like how you highlighted that, for example, sometimes we have to go to like a specialist provider and they are the only one that will pay out. And I wanted to give an example on income protection.

So we have a panel here at Umbrella Protect, so we have our panel, but we also have off-panel providers. We go off panel, for example, for income protection, and we would do a British Friendly’s Breathing Space without financial underwriting for directors of limited companies, right?

So we had a claim recently when someone was unable to work due to COVID, he was off from work for a few months and he was still receiving his direct salary. And we were able to make a claim and to claim on the policy because they are a specialist provider and they do not take that director’s salary into consideration. But at the end of the day, everything is done advisers’, product knowledge, I would say so everything is about training.

I wanted to highlight a few things about how companies or networks do train their advisors and also what technology they use. So we use a quality comparison service. We do pre-underwriting calls, there is always a medical. If we work with someone, we would as a first step do a full medical questionnaire and only then we would think, “OK, who’s going to be best for that particular case?” We would ring all the providers, and only then we would say Aviva or Scottish Widows or Zurich, right?

So product knowledge, knowledge of add-ons, additional benefits like fracture, like global treatment, and obviously that pre-underwriting research when someone has got some medical. Use of quality comparison services when comparing critical illness, use of Quality Analyser. Also being able to go off panel, I know that is not always possible if someone is with a network, I appreciate that.

But let’s say that someone doesn’t have that off-panel option, maybe they can partner with different companies, with a different business that has that off-panel option. And one last thing I wanted to mention PMI, private medical insurance. So we started doing quite a lot of PMI lately, and we have realised that someone really must be a PMI specialist in order to advise on PMI.

The same with, let’s say, General Insurance with building and contents. So what we’ve done, we’ve actually said to our advisers, “OK, look, guys, you cannot just advise on everything,” in my opinion, it’s very, very difficult to be a specialist in all areas of protection. That’s why we said, “OK, if you want to be able to advise on health insurance, on private medical, you have to attend all the trainings and you have to prove your competence. You have to know all the providers that we have on the panel.”

At the moment, we have four or five providers for PMI, and I want to be sure that every adviser that advises on PMI knows the offerings of all five providers. I actually see quite a bit of a problem when I sometimes speak with very busy mortgage advisers and they would just do, let’s say, basic life cover. They wouldn’t look into critical illness, into income protection, because they are just too busy. They wouldn’t look into PMI and they wouldn’t refer it to a specialist.

So to answer your question, definitely no, we don’t have too many products. We have a good offering. I don’t see a problem with that. I actually see a problem with how businesses operate, how mortgage brokers operate. I see a problem with them not referring to specialists, them not discussing the need for income protection or critical illness. I see a big problem with mortgage brokers, and I’m sorry if someone is a busy mortgage broker here, but I do work with a lot of mortgage brokers because we partner with a network and we help them with protection advice, and it honestly shocks me when I speak with them.

Sometimes I speak with mortgage brokers and they tell me, “Oh yes, I’m very busy. I do 10-20 mortgage cases in a month,” and then I ask them, “OK, and how many protection cases have you done?” “Oh, maybe five last year.” “And what have you done with the rest of those cases? What do you do? Do you refer them?” “No, why? I don’t have time or I just don’t want to do it. I don’t like to do it.”

So this is the problem that I see in the industry now, and probably we should focus on looking into this, into how businesses operate, how mortgage brokerages operate. What are they doing with protection advice? Why are they not referring to a specialist and also how businesses and companies do train their advisers? Do they know about quality comparison services? Do they know about all the add-ons?Do they know that they have to do pre-underwriting calls with every case, with every medical disclosure? That’s really what I think about it, Adam.

Adam Higgs: Certainly for advisers who are not protection specialists, the long list can be daunting and it’s about finding ways to support the conversations happening, partnering up and getting those referrals in place.

Alissa Wallington: We did mention Solution Builder a few times there and thank you, Setul, I know we’ve had some good sharing sessions with you guys. And it is something that we do in terms of, we recognise that there is a balance between how the providers want to come across in terms of: they are offering those choice, they’re splitting out the products, with child’s CIC, without child’s CIC, but it is absolutely massive.

We did a bit of analysis on it at the end of last year as we’re looking at reviewing, how we can do this? And it is a huge challenge. Because yes, the choice is there, and yes, I agree with Anna that having the range of products is fantastic, but also for the adviser at the end of it– and again both for the advanced adviser, the advisor that knows what they’re doing and for the adviser that’s new to the industry, both is probably still quite daunting. And how as a technology partner, we can come in and try and solve that issue. Whether it’s again, as I mentioned with pre filtering or post filtering, it’s always a big debate.

Because if you if you’re pre filtering, and I’d put it back to the experts, is that something that from a compliance angle we should be knocking out at the outset when we’re a comparison portal? Or is it that you’ve got those questions upfront and you want to knock those out and just see what’s relevant to your client at the end of it? Or do we give you everything and give you more flexibility on the back end to then be able to have a look at how you particularly in IP as well, how you then structure that?

So I would be really keen to speak to anyone who’s got any views or opinions on that and how we can look to make improvements because it is something that is a constant business challenge for us here, we are always looking at it and and what is the right way and what’s again easiest for the adviser because Solution Builder is about making it faster, more efficient.

We’ve put in tools, as you know, Adam, and we’ve mentioned Protection Guru in terms of making things more understandable, making that protection more tangible to the customer. Focus on the quality, not just the price, but it’s also how… all of that’s available there, but training is another thing, you need to have that supported with, how do I get to all of that? How do I work it out? I know it’s there, but I might not necessarily know how to use it or the best way to use it. When we put something out, we’ve got onboarding software that we try and walk you through it. But it’s still it’s still a massive challenge.

Ian McKenna: I’m actually going to put Alissa back on the spot, because I was going to invite you… What we’ve got to talk about here clearly is customer outcomes. And I thought it was worth inviting you to share some of the data that I know you’ve got about when advisers, when they use your product features report, which, yes, we put the data behind. But I believe you’ve got some quite impressive numbers in terms of the propensity of people to recommend a product that’s other than the cheapest. We’ve seen this as a pattern now, constantly growing for the best part of the year. Is that fair?

Alissa Wallington: And again, we’ve kind of made improvements to that along the way as to how advisers were using it and what we needed to change in the process because to get it out there, it was always kind of like the MVP that we put out there to say, let’s get this out there and see if it helps. And it’s being used as part of the process, but we have seen usage is just increasing and increasing. I think as advisers understand that it’s there, we’re making it available to more solutions as we move through Solution Builder. But you have put me on the spot in terms of actual stats and figures because I’m not sure I have those to hand, but…  It is significant. I do remember that.

Ian McKenna: An adviser is 50% more likely to recommend a product that is not the cheapest once they bring a quality comparison on board and the more they use the system, the higher that number goes up. The point I’m seeking to make there is, I think we all want to get away from price.

The ombudsman has this obsession with price and it really does question they’re interning training and skills. I mean, for God’s sake, if I’m buying life insurance for the people I care about, the last thing I want is the cheapest one. It’s like anything else in life. You get what you pay for. But and to be fair, the best way to protect against the ombudsman taking that view, you’ve got to have something that justifies why you are recommending. It’s not, to be fair, theombudsman doesn’t say “everything’s going to be cheapest.” What they do say is, “you’ve got to be able to evidence why you recommended something other than the cheapest.”

And I do think, alright, I’m going to give it a little plug. Any of you that haven’t looked at the Solution Builder’s users and you haven’t looked at the Product Features Report, you are missing a trick. It could be the data that iPipeline have shared with us previously really does show some very positive customer outcomes and also gives the adviser that the compliance evidence to back up that recommendation. So, if we’re going to have a lot of products and features, we need to be able to justify them, right?

Tim Bell: I think looking at IP, I really do think advisers are probably giving themselves a huge task here if they’re trying to select from, as you say, Adam, 80 quotes on Solution Builder. I believe Solution Builder is great. We certainly need 80 different options, but advisers are making it hard for themselves if they’re not having a discussion with the client beforehand. The fact find defines the shortfalls. I mean, Solution Builder will build a solution, but if you don’t know what the shortfalls are and you haven’t discussed what’s important to the client, then it’s a non-starter.

I just looked at my comparison report for one of the quotes I did. I didn’t filter it too much and quite rightly had loads and loads of quotes, ranging from £150.19 per month to £29.05. Now, if I was a client, I’d say all I have the £29 one, please. Thank you. But that might be for a limited payment policy for 12 months and nowhere near give the client the cover they need.

So it starts with a pretty in-depth fact find. An advisor, if they’re qualified, they should have passed the exams on how to complete a fact find and do a needs analysis. This could start from there. Once you’ve got that needs analysis, you’ve discussed the shortfalls, you’ve discussed the deferment period the client can manage. And that’s got to be through discussion because a client, yes, would love it to kick in after a week.

But if they’ve got sufficient savings, then why not defer it for 12 months or six months or three months? The benefit period, the claim period? Have they got an idea of how that would affect them in the long term? Do they need to have long-term protection or short-term protection? The cover amount? Do they need the full amount available? Do they need 60%?

So all of those should really have been discussed and identified before you go on to Solution Builder because that’s where you’re building the solution to the needs that you’ve identified. So that will cut out an awful lot. Solution Builder could help a little bit more in defining the different options, possibly. So that when you do run a quote, you only get half a dozen, say, because you’ve defined all of the options that you want. And then obviously you go to the client if they still say, “Well, that’s a lot of money,” that’s when you can discuss the other options to reduce the premium.

But you’ve got to initially, if you’re doing your needs analysis and if you’re doing your recommendation letter as an adviser, if there’s affordability there, forgetting budget, then you’ve got to recommend the solution that meets those client’s needs. If they do not wish to spend that amount of money, yet they can afford it, then you then leave it to them to take away options, reduce cover. But as an adviser, you recommend to shortfalls and then discussions.

Jack Southcott: Let me just jump in with a view from The Exeter. It’s been interesting to hear the responses actually because we ran some anonymous research at the end of last year and we asked this very question. It was with one of the portals and the question was around how advisers rate the current range of income protection products in the market.

And the response surprised us a little bit. Actually, 80% came back and said it was about the right amount of choice, 15% said that it wasn’t quite enough choice and only 5% said there was too much. And that’s the part that surprised us a little bit because even as someone that should know these things inside out, looking at 80 products, sometimes when you are when you are doing an income protection quote, you have to be looking at about five things at once to be working out exactly how I compare this one to this one.

But it was interesting that the response back was actually “it’s fine.” And like we’ve been saying, the portals do make it easier by having some filterable configuration and also having the feature add-on as well. That’s come in quite recently. So just one piece of feedback that we have given one of the main portals– that wasn’t iPipeline– is that sometimes making things too filterable can actually can actually overcomplicate.

So when we launched our product last year, for example, we added on a GIO for rental, which is quite common now. It’s probably more than half of the providers in the market have have a rental feature in their in their GIO options, but to have a rental flag next to our products, we would have had to clone it twice. And that’s because that rental flag was only a yes or no.

So at the moment, our product appears regardless of whether you select rental or not, it’s always there. Whereas if we if we decided to have a little ‘R’ next to it, if somebody said “this isn’t for a renter,” then we wouldn’t appear. Which is basically suggesting the product is not suitable for someone that’s looking for a mortgage. So, for us, that’s a little bit of a concern is that where innovation is actually potentially complicating the solution rather than making the experience better, we need to be a bit careful. So for that reason, we don’t have a rental flag and therefore that’s where we are with that position.

Emma Astley: Of course, I think it’s just so important to have that quality conversation with the client and not be scared of asking questions. So, explain it about the benefits and the differences between two providers. So we have a lot of clients, we do a lot of children’s cover, but we go right into detail of the difference between… We call it having bump covered.So we’ll actually then show them the differences of the pregnancy complications– is the client covered from 20 weeks, 24 weeks, from birth?

And it’s about that explaining the benefits in good detail so the clients understand the benefits and what is actually suitable for them. And it makes the journey a lot easier for us. For me and Gemma as advising our clients in the right way, so it’s never about the cheapest premium. You’re right, I hate that and I’ve seen that with the past companies that have worked with it was cheap, cheap, cheap, bang it out, bang it out. And it’s just life insurance only, with no real conversation so the client doesn’t understand their need.

So we just make sure that we do that really and just take the details, have that conversation. We’ve had so many lately of domestic violence– a lady who was sexually abused, which ended in a pregnancy of a beautiful daughter. But we’ve been able to go into such detail with our clients because of how they feel comfortable with us. And that then makes our job a lot easier when we’re actually recommending the products and explaining why you can’t have a certain product because of the history and the disclosures, especially around the mental health.

So it is important. Benefits rather than the cheapest premium because the client understands that and actually appreciates it a lot better than just being given the quick, cheapest policy. And let them ask lots of questions.

Adam Kaplan: And I know a lot of this has been said already, but having listened to Anna, Scott, Tim and obviously Emma, there’s a lot of stuff that I agree with. What I just want to add from my point of view is, we do a lot of income protection and ultimately the first thing is to have that conversation with the client about their medical background.

I think what Anna was saying earlier, but I’ve got a couple of cases recently where I’ve had– I’ll try not to name any insurers– but one insurer in particular who offered standard rates, whereas everybody else was saying ‘mental health exclusion.’ So for me, that’s super important, and I did call the insurer up and say, “Look, are you sure about this because everybody else is saying the exclusion.”

We did get it through without the mental health exclusion, but that leads on to all the additional benefits. It’s all good and well, having all these additional benefits, which are great. But ultimately, if the underwriting decision is not good, it might be that I wouldn’t go for somebody that has got fracture cover just because they’ve got fractured coverage, they’re going to exclude something, yet another insurer doesn’t provide fractured cover, but they’re offering a policy with no exclusions.

For me, it’s more important to go down that road first. And then if, for example, what I’m approaching with a couple of insurers now with optional extras is: if that insurer is the best insurer from an underwriting point of view, then it’s a case of, “right, we’ve got all these additional extras. This is what they are. This is how they work. This is what they cost. Would you like to add it on?”

Because there’s no point introducing that into the conversation at the beginning, if that insurer is going to rate 50 or 100% for BMI, is going to apply mental health exclusion, or a back exclusion because you’re setting yourself up to fail. Because they’re like, “Oh, those benefits are amazing,” but “sorry, you can’t have them now because this insurer is better.”

So that’s how we would approach it. But certainly on the income protection side with age, cost, and premiums, I love the fact that there’s such an array of options for income protection because it does give you the ability to write more business. But it’s also important that the client needs you. The client isn’t going to go online and… I’ve got a perfect example of why, but I won’t share that now.

But I’ve just got a case I’ve just sorted out in the last couple of weeks where, believe it or not, the difference in the premiums over the term was over £11,000. There were two insurers based on underwriting.

Both had exactly the same premium £74 something and a few pence. But by the end of the age-costed period, one was over £300 a month. The other was about £120 or something like that. But I then calculated the total premiums that were on the illustration, and one insurer was £11,000 cheaper than the other one over the full term.

And that is where some advisers will just see a slightly cheaper premium go for that because it’s cheaper, but actually long term, it’s going to be significantly more expensive. So from my point of view, when I’m looking at all the age-costed premiums, I will go into the detail of what’s the actual total premiums over the term?

Because you might find somebody, it might be £5 or £10 a month cheaper to start with, but actually is tens of thousands of pounds cheaper long term. And in my opinion, they’re less likely to cancel with the age increases are less each year, then. Does that make sense?

Adam Higgs: When you get a mortgage you’re shown what you’ll pay over the term of the plan—maybe we should be doing the same thing with age-costed.

Adam Kaplan: I’ve got one I looked at earlier, the total premium is payable over the full term– with one insurer was £146,000. The one we’re going with is £26,000.

Adam Higgs: Massive difference.

Adam Kaplan: And that is the next level of detail that we go into that, with respect to a lot of other advisers, they won’t even think to look at that.

Anna Glod: Very good points, Adam and I totally get you when you said, I also have this problem sometimes that when doing pre-underwriting, someone would accept on standard. And that’s fantastic. And I had that, for example, someone had a cancer a year or two years ago. Everyone else would do that cancer exclusion, but then one  provider would accept it on standard. And that’s fantastic.

But then I have this dilemma because that provider wouldn’t offer fracture cover, right? And we needed fracture as well, or we needed that global treatment add-on. So I don’t know if you, Adam, do that too? I wanted to ask you, but what we at Umbrella Protect, what we would normally do in such a case, we would perhaps look into doing two covers with two separate providers.

So I would do maybe a critical illness with that provider, which accepted on standard. And then I would. Critical illness with life and then maybe smaller life cover with a provider that will offer fracture. You see something like that. So would you guys and Adam, would you would you also do that sometimes like going with two different providers?

Adam Kaplan: A hundred percent. I’ve got a case we’re doing that with at the moment where the GP service with Guardian, because one of the comments they made was that it’s so difficult to get a GP appointment so from our point of view, obviously, we all know that it would be easier to place it all with one insurer. There were no issues from an underwriting point of view, but what we have done is we put part with one insurer because they like the benefits of that. And then we’ve done…

Anna Glod: Sometimes we have to place or do two different. Exactly, exactly. And also one last point, which I will mention and then I will go. So basically, about the age-costed, and I think that is very important to highlight again, down to the compliance of each business processes, compliance processes and also what each company established as best practise with a recommendation letter.

Because, for example, what we’ve done at Umbrella Protect, we have this requirement that when an adviser recommends age-costed, age increasing income protection, they have to actually confirm in the suitability letter how much the cover will cost in 10, 20 years time and also at the end of the term. So they would have to confirm your cover cost £25 now, this is the premium in 10 years, in 20 years, and also when you reach 67. They have to confirm that in the suitability letter and then they have to compare it to the guaranteed premium available at the moment.

You see what I mean? Because the client needs to be put in informed position, they have to know that, “OK, it costs £25 now, but may be £150 or £200 in twenty years, as opposed to going with something which cost £60 now. So this is, for example, what we implemented in terms of our compliance and our suitability letter requirements.

Adam Higgs: I think it’s a really good point, ensuring that the customer understands that this goes up and particularly with age costs where you know exactly how much it’s go up and you can display that. It is really important because I’m always slightly concerned that certainly when someone gets to later stages of those policies, it may…

Anna Glod: Become not only that, it’s also to cover our back. We’ve seen complaints, we actually have seen some complaints, of people coming and complaining, “why is this premium increasing? I was never told that is going to be increasing cover. I want to cancel because it’s like £6 more expensive now.”

And if we don’t have that in writing, it always is going to be down to he said, she said. My adviser will say, “I did tell you, I told you, I’ve explained.” The client will say, “I do not remember you never told me.” Also, if you run a business, what if that adviser doesn’t work for you anymore? If this is an exit adviser case and the client will come and complain, it’s important to have that in their notes, in the suitability letter.