A life insurance industry veteran has voiced concerns over an apparent lack of controls after he was contacted out of the blue by a firm claiming to an appointed representative of Legal and General.
Mike Ward, founder of the consumer price comparison website payingtoomuch.com and previously Direct Life & Pension Services managing director, told FTAdviser that he was called from an unknown number by a firm claiming changes in legislation meant he could reduce his life insurance premiums.
Having recently changed policies, but doubting the claim about new legislative opportunities, he called back to be greeted by an automated message offering compensation for a delayed flight.
The following day, someone claiming to be from an adviser named Life Protect, which was described by the caller as a ‘appointed representative’ of L&G, called and again pledged to be able to save him money on life insurance.
Mr Ward pressed the caller on where he had obtained the phone number and was told a number of ‘lead’ sources were used including The Review Experts, a company which provides data for consumer and corporate mailing lists.
There is one firm on the FCA register with the name Life Protect Ltd, which is listed on the register as “no longer an appointed representative”. Its director is Trevor Whiting, who is also the partner of independent financial adviser Core Financial.
There is also a website for a Life Protect, which describes itself as the “direct insurance provider arm of Core Financial LLP”. The site, which remains accessible at the time of writing, displays the logo of a number of providers, including L&G.
Mr Whiting told FTAdviser that Life Protect is a ‘trading style’ of his firm. He added that the website “really lies fallow and we do not expect any activity”.
He said Life Protect Ltd was an entirely separate legal entity* that was set up a number of years ago and which now generates no revenue and is being wound down. He said the caller was using the firm name and, seemingly, its regulatory number, but was entirely unconnected to the firm.
“I understand there is an individual/company purporting to be Life Protect and agents of Legal and General that are ‘selling’ products, it would appear off the back of this name.
“A business can almost call itself what it likes, it seems that this individual has chosen the Life Protect name, perhaps because it’s a good name,” said Mr Whiting, adding: “However, this is without any contact with us and certainly without any permission to do so.
“I have tried in the past to unearth exactly what is going on here, but to no avail... We find any connection very frustrating and feel powerless to do anything about this.”
A spokesperson for L&G said in a written statement that Life Protect was related to Core Financial, a directly authorised firm and therefore responsible for its own compliance. She added that the firm was not an appointed representative of L&G.
“As a product provider we have certain responsibilities, however, [Life Protect] sits within a directly authorised firm responsible for their advisers’ selling practices. Core Financial does have an agency with us but have only completed a small number of cases with us in the last 12 months.”
She said that L&G would be contacting Core to discuss the issue.
Mr Ward complained that both calls by the unknown caller appeared to be in breach of the FCA Handbook and those with less financial services experience could have been misled into buying unnecessary products.
“Ultimately if Core know they have a problem they ought to close the website down immediately, which can be done virtually real-time and certainly within a business day. These type of issues need to be raised to the top of the agenda if we wish to clean up the reputation of financial services.”
He continued that “the FCA needs to get a grip”, warning that while the industry has set up working parties to work out how to better protect families, there were risks that “behind our backs, someone is signing off this type of behavior and some life insurance company somewhere is willing to accept the new business it generates”.
* Update: The article was amended after publication to change the word ‘regulated’ to ‘legal’.
peter.walker@ft.com
