Protection IFA Moneysworth has warned simplified underwriting is 'going down the wrong street' and risks non-disclosure as research revealed a significant number of advisers believe it could close the protection gap.
A poll of advisers on the Avelo Exchange found over a third (35%) thought simple underwriting could address under protection in the market and boost product sales.
Andrew Wilkinson, director of Moneysworth Ltd said: "We feel quite strongly about this and we feel simpler underwriting is going down the wrong street. We think it's a bit of a smoke-screen. In our business we tend to arrange protection for people and specialise in people with health conditions or in occupations with more risk, where ratings are going to apply.
"One of the things we and our clients are very keen on is full disclosure. I think you wouldn't buy a house without a survey and I don't know why a life office would take someone on without some kind of independent opinion. If you're going to go through a process that misses that out, there is going to be a risk of non-disclosure."
Wilkinson said that most of the applications he had come across involved the necessity for further medical evidence, and clients were not put off by any additional complexity involved in the process.
"It's getting the job done properly and not quickly, that's what's important. We give our clients an expectation of how long GPs will take to return medical evidence and we tell them we will keep in touch and keep chasing. When we set an expectation at the beginning with clients at least they know what to expect."
However, Wilkinson did agree with the Avelo poll's findings where a further third (35%) of advisers said incentives, such as linked reimbursed NI contributions, could help close the protection gap.
He continued: "I think it would be a really good way to finally get good take-up of IP. There seems to me to be a lack of joined up thinking on the government's part. They want more people to take more responsibility for themselves so you have to provide opportunities for incentives.
"When it's such a low penetration rate, so few people have IP policies, for most of our clients they can't even get it due to life companies excluding most people with health conditions. The greater issue is even for those people without health conditions they won't buy the policies. I think tax incentives would provide encouragement."
