The fall out of payment protection insurance continues to give the business of protection a bad name. The drip feed of bad press around insurance products for everything from credit cards to bank loans has done nothing to alleviate the imbedded scepticism of consumers to the notion of value in protection.
This is a real tragedy as many products such as income protection offer real, easily understood and quantifiable benefits for consumers. However much like investment products, insurance products where there is no legal imperative for consumers to have them, need to be sold and this is where the broker market often comes into its own.
There is an important distinction to be made with regard the benefit and function of protection and the poorly aligned products of PPI era. Just because the wrong protection has been sold in the past does not mean that protection in itself is wrong. Many clients still require some form of protection from becoming sick, having accidents or becoming unemployed.
Mortgage payment protection insurance, income protection and life cover all have a very real benefit for people as they protect consumers from the major life shocks that can affect us all. The trend, it seems to me, is that when insurances are attached to specific products such as loans or credit cards, their value diminishes exponentially.
Brokers have an opportunity to restore the good idea of protection and benefit from the misbehaviour of the high street providers by selling well thought through meaningful products. Let’s not miss out.