Income Protection Champion 2022 & CI Expert special offer

Hi everyone, welcome to this week’s protection update.

We’re on the road at the moment and we’ve been to see you up in the North East and in Scotland.

Next week we’re in the North West at the Mere, Midlands at Copt Heath Golf Club and then finishing off in Cwmbran on Thursday.

I’d like to start this week’s protection update by announcing a brand-new competition for the network.

Income Protection Champion 2022

It’s the Income Protection Champion competition which kicks off today and runs for the next 3 months up to Friday 30^th October.

Let me explain the logic.

As an industry, Income Protection is sold at a significantly lower rate compared to life cover and critical illness cover over the past 20 years.

We need to do something about this because the statistical probability of needing to make a claim and actually making a claim are just significantly higher on an income protection policy compared to life cover and critical illness cover.

I look at protection in a simple way.

Protection means money on the table when you need it the most.

Money on the table if… you die or you get sick.

How can you get sick?

Well, you can get a critical or serious illness.  That means an illness that is a threat to your life.  A really serious illness that you could potentially die from.

The trigger to allow you to make the claim is a professional diagnosis of a certain condition.  Sometimes it’s the treatment to a certain condition.

Or it could be something which simply keeps you off work and makes you lose your income.

With income protection covers you if you can’t do your own job.  If you can’t do your own job and you lose your income; Income Protection plugs that gap.

If you take a look at the Cirencester Friendly Claims report that was published in March 2022, it reports that the top 3 income protection claims they paid out in 2021 were for:

• Accidents 37%
• Back, Neck, Shoulder, Muscular or Arthritis – 19%
• Common infections – 15%

That’s nearly 3 quarters of their entire claims book and none of them are things where you can use your critical illness policy.

The great thing about the current landscape of protection solutions is that it’s the best it’s ever been.

Providers have been superb with their innovative solutions to allow more people get income protection.  There are options that allow you to get the cover for your clients at an affordable cost by allowing you to adjust things like the sum assured, the claim payment period, the deferred period Ceasing Age; all of which help you fit this solution into the budget.

Income Protection and CIC?

When you make your protection recommendations, you’ll have a clear idea about what the solution aims to do.  Pay off a mortgage, replace an income, maintain a lifestyle.

Another good thing to link the product solution to is lump sums to fix lump sum problems.  Incomes to fix income problems.

That means Income Protection and Critical Illness shouldn’t be sold exclusively but actually together.  They compliment each other really well.

Think about what the income can be used for.  Think about what the lump sum can be used for.

If someone does suffer a critical illness and let’s say they have to take a period off time from work.

They get the lump sum from the CIC policy and that can be used to repay debts such as the mortgage, pay for treatment, pay to change the home or even just pay for a well needed holiday.

The income protection plan just makes sure there’s a continuing income which means the normal bills get paid.  They don’t stop and it would be a shame to have to use the lump sum from a CIC policy to pay for the shopping and council tax.

Risk Probability

But is this real?  What if you don’t know someone who has claimed on an income protection policy?

Does it actually happen?

Covid was certainly something which allowed people to appreciate that people have to take time off work sick and many of the providers have reported that as a reason they paid significant amounts of claims.

But let me show you a few protection risks probability examples.

• John, 30, non-smoker – retiring at age 65?

Chance of claiming on an income protection policy (that means 2 months off work or more) – 28% (Death is 4%, Serious Illness is 14%)

• Jane 40, smoker – mortgage to age 60?

Chance of claiming on an income protection policy 28% (Death is 5%, Serious Illness is 10%)

• And If you look at a couple of first time buyers Tom and Tina – both 30, non-smokers with a 30 year mortgage?

Chance of one of them claiming on an income protection policy 44% (Death is 5%, Serious Illness is 16%)

I’ve added a link to the Risk Reality Calculator with is a brilliant tool to help you portray these risks to your client to this week’s protection update.

Remember what it says on every mortgage illustration and mortgage offer… You’ll see a risk warning, written by the Financial Conduct Authority that says things like:

• Your home is at risk if you do not keep up repayments on your mortgage or other loans secured on it…
• Make sure you can afford your mortgage if your income falls
• Your income may change… Please consider whether you will be able to afford your monthly mortgage repayments if your income falls
• Your home may be repossessed if you do not keep up repayments on your mortgage

What’s the common theme there?

What’s the most likely protection solution they are talking about?

Advising on mortgages and then the protection does give you a natural link to address what is the most likely type of claim your client is going to make.

And the solutions available are the broadest and best we’ve ever seen.

TRM Income Protection Champion Competition 2022

Towards the end of September, there will be an industry wide income protection initiative by the IPTF – the Income Protection Task Force.

The Right Mortgage are actively involved with the IPTF and we will be supporting Income Protection Awareness week.

Our competition will start from today – Friday 24^th June and it will run until September 30^th 2022.  That’s the week after income protection awareness week and we will announce the winner at the NTE on 6^th October in Birmingham.

Let me run through the rules of the competition:

• The winner will be the adviser who has written the most income protection policies during this period of time. We’re not looking at commission or API.
• Policies can include any kind of income replacement solution including:
  • Full income protection – standard conventional income protection policies
  • Limited payment period Income Protection – IP policies that pay claims for a year, 2 years or even 5 years in the event of a claim.
  • MetLife MortgageSafe – which you can now quote on Solution Builder. This is a great innovation that allows you to protect your clients mortgage payments.
  • National Friendly Accident only income protection – this is a policy which isn’t underwritten because it only covers accidents. But we will also include the other Income Protection covers from National Friendly.
  • Executive Income Protection – this is a policy, a bit like Relevant Life. Taken out by the employer, for the benefit of an employee.
  • Key person Income Protection as a business protection solution
  • Group Income Protection. Group policies count as 5 policies

• If you recommend any Split deferred income protection count as 2 policies
• Advisers must write a minimum of 2 income protection policies in each calendar month of July, August & September to qualify – the only exception to this is advisers who join the network in August or September.
• We will award bonus points for the diversity of the providers you use. So, in other words, you will get one extra point for every provider you recommend.
• And you do need to clearly mark each income protection sale as ‘Income Protection’ on the Key.

We will give updates and recognition regionally over the next 3 months and we will present the award to the winner at the NTE on 6^th October in Birmingham.

Good luck everyone.

CI Expert Special Offer.

Now one more thing that is very much worth mentioning this week; I’m delighted to announce that we have secured a very special offer for advisers within the Right Mortgage Network starting next week.

CI Expert is a tool which allows you to compare the quality of any critical illness policy old and new.  It’s a tool for advisers created by advisers.

Let’s say for example you’re doing a review with your client and they took out a policy with a provider a few years ago.

How can we easily demonstrate that there are much better options available on the market today?

It might be an old policy which might not have great overall coverage, but what if it does have something particularly special in the definitions.  For example, some of these old plans had quite broad definitions for Cancer.  Some of them would pay a full payout for Angioplasty.

It’s a dangerous game to replace critical illness policies without being able to fully demonstrate not only what the client stands to gain with the new policy, but we also need to make it clear what the client stands to lose by replacing.

CI Expert gives you an easy-to-read and easy to understand report that compares and scores both old and new policies.

Now the normal cost for CI Expert is £39.60 per month but we have secured a deal to give you full access to CI Expert for just £10 per month.

This offer will run until the end of September this year and I’m hoping to actually get that extended until the end of the year.  I’ll let you know how I get on with that.

Watch out for my official announcements next week although if you can’t wait until then, you can email support@ciexpert.co.uk and tell them you are a member of The Right Mortgage Network and you would like to sign up for this special offer.

I’ll be setting up some drop in Webinars to show you everything you need to know over the next few weeks.

Or of course – give me a shout if you want to discuss any of this further.

That’s it from me for another week – if you’re coming to the North West, Midlands or South West roadshows, I’ll see you there!

Have a great weekend everyone!