Industry expert labels broker-designed protection products system inadequate
By Lucy Quinton
An industry expert has slammed advisers' fact-find systems, arguing they are not up to scratch when it comes to protection products.
Alan Savery, protection specialist at Resolution, berated fact finds for often being designed to fit mortgage brokers and therefore not being able to sell protection.
Agreeing with Savery, Roy McLoughlin, senior partner at Master Adviser, said that companies should ask protection questions in a fact find and include a disclaimer in the interests of complying with the Financial Services Authority's Treating Customers Fairly initiative.
This would ensure that if a client chose not to take up the protection, the firm would be assured that they had complied with regulation by at least offering it. "They need to ask the questions and the obvious place to do it is in a fact find," he added.
Alan Lakey, principal of Highclere Financial Services, said: "It seems to me that most advisers concentrate on investments and give much less thought to protection issues which is remarkable when you consider that death/illness/disability will stop the flow of income and ruin most, if not all, future plans."
One commentator suggested the problem with fact finds could increase as mortgage intermediaries are being encouraged to look for alternative revenue streams in the wake of a slump in sales.
Lakey said the people who concentrated on mortgage business will "be in trouble if they do not open up other avenues such as protection".
Last month, Moneysupermarket.com added the PruProtect product to its fact-find range after months of delays, as the website had to re-sort its fact-find system to incorporate the new product.
Since the launch of the website, Moneysupermarket.com has sold four PruProtect policies. Louise Cuming, head of mortgage services, commented that the product was designed for the long haul as opposed to the short term.
Cuming insisted the product will take off and become increasingly popular as more people catch on to the idea of the benefits it can bring.
Dave Priestley, head of intermediary sales at PruProtect, said the two businesses had worked together to ensure the teams were properly equipped to deal with the product. "Early indications are very positive and we are excited about the opportunities that lie ahead," he added.
