Royal London’s guest blogger, Robert Harvey, Head of Protection Advice at Drewberry, talks through a client example.
I was struck by a recent keynote address at the Cover Protection & Health Summit by broadcaster Simon Thomas on the importance of thorough holistic protection advice. It reminded me of one of Drewberry’s clients who needed to claim. Like the Simon Thomas case, I believe this serves to illustrate the crucial role advisers play and the importance of providing protection advice across your clients’ need areas.
Several years ago, a client came to us looking for income protection. They’d been running their own consultancy business for a year and were finally getting around to looking at protection.
When advising a client who gets in touch with a very specific need, it can be all too easy for the adviser to be blinkered into simply satisfying that immediate need and facilitate the ‘sale’ of whatever product the client wants to purchase. However, at Drewberry we believe in truly holistic advice and therefore insist on a full and thorough fact-find, establishing the full spectrum of protection needs.
In the case of our consultant client, we discovered that despite supporting a stay-at-home spouse and two young children, the only life insurance they had was to repay the mortgage, with nothing to provide for other living costs.
The protection gap of UK households is something we’ve focused on in our own research; Drewberry’s 2017 Protection Survey of 3,000 working adults found that only 37% had any form of Life Insurance. Among those who did, it’s likely that a significant proportion wouldn’t have an adequate level of cover for both mortgage and family protection. More worrying still, only 6% reported having income protection insurance.
