All clients must get the protection they need
Steve Bryan (pictured) is director of distribution and marketing at The Exeter
For mortgage brokers, protection insurance and life cover should be a pretty easy sell. The hard truth is that too few people in Britain have enough savings to ensure the financial security of their household in the event that the main earner dies or is unable to work.
For individuals with existing health conditions, these risks are even greater, yet experience suggests mortgage brokers are actually less likely to raise the issue of life insurance and protection with these clients.
And it’s easy to see why. It can sometimes feel awkward to ask questions about a client’s health during the mortgage application process.
Plus, conversations like these can be even more difficult where the broker knows – or simply suspects – that the client suffers from poor health.
There are other stumbling blocks too. Many mortgage brokers simply assume that clients like these won’t have any chance of securing affordable cover to protect their investment – or else they don’t know where to find it.
Yet raising the issue of cover for clients with medical conditions is both necessary and worthwhile. In fact, mortgage brokers should see it as an obligation.
If a client has children or is taking out a mortgage with a partner, for example, conversations like these are especially important – and ultimately for the client’s own good.
Most people are likely to be grateful when this issue is raised, rather than insulted, as it clearly shows the broker cares about their client’s long-term financial security.
The truth is that pre-existing medical conditions or poor health won’t stop a borrower from securing cover in most cases. Depending on the condition, its severity and the type of cover, insurance may even be available at standard rates. In other cases, the choice may be limited, or cover may be available at a higher cost or with exclusions.
New developments, such as managed life , are already increasing choice and affordability for borrowers with existing health conditions. Policies like these offer better premiums to clients who are committed to improving their health or lifestyle.
But mortgage brokers will need to broach the subject first – and also understand what options are available.
Some advisers may not feel confident to find and arrange this kind cover themselves, but they can always turn to specialist intermediaries for help.
Either way, it’s an area that mortgage brokers need to think about carefully, starting with their very first meeting with a client. The number of people living with medical conditions is only likely to increase as people continue to live longer, so advisers can’t – and shouldn’t – avoid this issue.
Mortgage brokers have a duty to ensure that their clients’ financial future is protected – and that means finding the cover they need, whatever their situation.