Life InsuranceMay 2 2013

Tenet: A protection trade body is vitally important

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BySimoney Girard

According to Gemma Harle, managing director of TenetLime, one of the reasons for this is the recent shift to diversification within adviser businesses, precipitated by the retail distribution review, which means more firms are offering protection advice.

Ms Harle said another reason was to counter the raft of regulation: “Trade bodies do so much good work for the industries they support; a lot of it behind the scenes to stop unfavourable issues or regulation from ever seeing the light of day.

“In the context of increasing European regulation, it is vitally important that the protection industry also has a united voice to protect its best interests.”

Ms Harle’s call for action came a few weeks after Tom Baigrie, co-founder of London-based protection advisory firm LifeSearch, made an appeal to guests at the LifeSearch awards event to back his proposals for a distributor’s trade body.

Mr Baigrie said: “There is a need for quality control and this is why, a year ago, I laid out a protection distributors’ code of conduct, designed to apply not just to advisers, but to all who distribute protection by any means. We think all those with their own in-house distribution should join us, and we’ll be moving our agenda through this year.”

Distribution Trade Body background

In March, the new trade body for those involved in the distribution of pure protection held its first inaugural meeting.

It builds on the insurance code – unveiled at the 2012 LifeSearch protection awards – which included points such as sellers must state clearly to customers at outset whether they provide regulated advice or not.

It also called on sellers to demonstrate that they have provided properly for the repayment of indemnity commissions on lapsing policies.

LifeSearch has gathered support for its five rules from 50 major firms across distribution and a steering committee has been appointed.

It consists of one of each different type of distributor, from direct-to-consumer through to the independent whole-of-market advisers.