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Home > Insurance > Protection

By Steve Casey | Published

A natural-born salesman

As an industry we all know that one of the biggest battles we face is getting consumers to sit up and take action – particularly when it comes to getting cover in place for death or serious illness.

The industry puts in a lot of effort to show the very real need for protection products, with high-profile advertising campaigns pointing to the need.

Despite this effort, there is a natural human reaction of not wanting to think about this sort of thing. This is often coupled with the hope that “it won’t happen to us”.

But it does unfortunately happen and every day in the UK, many families may suffer from severe financial hardship because the breadwinner dies prematurely or is diagnosed with a serious illness.

Alongside the dawning reality that “it has happened to us” is often a pressing financial need. Families are struggling to cope with the emotional impact of the death or illness of a loved one as well as the practical implications of meeting their financial commitments.

This highlights the urgent need to ensure that the customer receives the benefits from the policies they have taken out as quickly as possible.

The industry is always looking for ways to improve and speed up claims handling – particularly in the protection field where these claims are usually the result of serious illness or death, and are therefore particularly sensitive.

But there are things that we can do to make things quicker and easier in terms of handling claims – and some of this goes back to the way a policy can be set up in the first place.

There is a natural human reaction of not wanting to think about protection

Trusts are currently underused but they can be a way of ensuring that benefits are paid out to the beneficiaries very quickly when the worst does happen and a customer has to claim. There is sound logic for many forms of life protection products to be written into trust. A common misconception held by clients is that having a will, along with some protection cover is all that they will require. But statistics produced as part of last year’s Write a Will Week suggested that up to 70 per cent of the UK population did not have a will anyway.

Consideration

But even for those who have got a will and some protection cover in place, there can still be issues that they may not have considered, including wider financial planning needs, the potential implications of inheritance tax and the difficult issue of influence perhaps being exerted in terms of the destination of the benefits being paid out.

Even if none of these potential complications arise, many clients are unaware that, irrespective of financial plans they may have in place, their estate cannot be accessed without formal approval – which can take time.

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