Owain Thomas finds that, sometimes, driving a Ford Focus rather than an Aston Martin is a good thing
“You don’t do that, you go out and buy a Ford Focus and work your way up. But right now, we say it’s all or nothing. It’s done with the best intentions and a really nice honourable position to take, but by doing so we probably limit accessibility. So awareness is obviously hugely important and what Aviva and Unum are doing is creating a category that doesn’t currently exist because there’s not even a tiny part of the consumers’ mind that says ‘I need protection insurance’,” he added.
Another active undercurrent has been that of improving technology to get clients on risk sooner and easier and in preparation to address the stern tests impending at the end of 2012.
Exeter Family Friendly has already ticked one of those boxes by becoming the first provider to publicly unveil its gender neutral product. But concerns have been raised that while business may be written quicker with this expensive new technology, sometimes it is being used to mask flaws in either products or a lack of flexibility and creativity for clients.
This rigidity from providers has also been noted by advisers who would love some more options to offer their clients, including some of Clive Waller’s suggestions.
Peter Lurie, director of Proactive Medical and Life, is one such intermediary who has hopes for a wider palette of colours to choose from. “I personally think all insurers should open their eyes,” he said.
“There’s only one or two who financially underwrite at application and that for me is one of the key selling points of an IP policy because nobody knows if they’re going to be made redundant or going to find a new job that’s paying them less in a year’s time. If you financially underwrite at the point of application you give so much more peace of mind to the client than at the point of claim,” he added
A further key concern of Lurie’s is the flexibility (or lack of it) around deferment periods before the benefit is paid, while the ability to exclude conditions from coverage and even taking some initiative from the PMI world gets his approval.
“People should be able to pick and mix the terms for their products and providers need to be more flexible,” he said. “We’re paying a high premium for these products, they’re not the cheapest on the market and there should definitely be the option to choose how you can pick those deferment periods.Why should it have to be day one, day seven or week four – why can’t it be the choice of the client?
“I’ve always been a massive fan on reduction of premium based on exclusion and I like the option to pick and choose a modular element of a policy too. I think we’re delving more into the line of medical insurance’s modular policy and although very different, there are funnily enough, some similar elements.
“So why not?” he concluded. With the market not likely to re-enter the fast lane until the economic recovery kicks in perhaps that is a question more income protection providers should be asking themselves – why not?
