LifeSearch has recently released a code of conduct it would like all protection sellers to adhere to. Should there be such a code and what does it say about this market that it should originate from an intermediary rather than a provider?
Dean Mason, Masons Financial Planning
It is refreshing to see a large IFA introducing such a scheme, although I'm not surprised it has come from LifeSearch. It is not the first time it has been innovators in the protection world. This does, however, open up a wider conversation.
The Association of British Insurers' (ABI) critical illness scripts, released in the past year or so, seem to have largely disappeared under the radar now, and the industry's top brass seem to have moved their focus elsewhere. Even treating customers fairly (TCF) seems less important to the regulators than it was a couple of years back.
So, why is this move a good idea and why should it go to the industry at large? There are many IFAs and mortgage brokers out there who have never been properly trained on protection.
With the inception of the Retail Distribution Review, many more will enter the market place without suitable protection training or qualifications. This can only be bad news for the consumer and will subsequently generate negative publicity for the industry - we really don't need that.
A significant proportion of the wider public is still very sceptical of protection advice. Having a code such as this publicised, used and monitored would help all of us in the industry and raise our profile in the public eye.
In addition, it will help advisers at all levels of protection knowledge to monitor themselves and demonstrate a clear difference to those who think they can just ‘buy it online'.
So in my view, the FSA, the ABI and insurers should be copying Tom Baigrie's lead and taking this industry wide.
Phil Jeynes, PruProtect
The code of conduct LifeSearch has drawn up is extremely sensible. From a provider's point of view, most of the points it addresses are factors of which we are already mindful.
In recent years, following some high-profile cases in which insurers were left with large liabilities after dubious firms collapsed, the granting of agencies and - in particular - of indemnity commission arrangements has been scrutinised more than ever before.
Having given a firm an agency, we monitor processes and performance very closely to ensure best practice. We have membership of more than one industry wide body, which shares information concerning bad debts, and we take any hint of poor sales practice or below-par retentions very seriously.
