Some of you will have already analysed the reasons and many will attribute it largely to the efforts of Lloyds Bank and the heroic example of Johnny Timpson who is one of the most passionate advocates of IP in the country. They have a decent point, although passion for IP is evident in quite a number of places now.
Such a perspective fails to acknowledge the very important fact that several thousand more people will sleep more soundly in their beds because they have appropriate protection in place. That matters and if it ever stops mattering to you I suggest you leave the protection industry.
On top of this we have seen the publication of claims-paid statistics from all the major IP offices. That is a source of great satisfaction our executives at the Income Protection Taskforce who have campaigned for this for years. Dare I say, without this effort and an active core of committed journalists who saw the sense of such a move, it would not have happened. Certainly without Roy “the Enforcer” McLoughlin – who has sacrificed a lot of time and effort to move the market towards a state of much more reassuring transparency – this would not have happened. The reason Mr McLoughlin put so much effort into this is because he talks IP every day with clients who need it but have been deeply concerned following the PPI scandal that they will be ripped off by insurers.
As I write this, the Financial Ombusdman Service has revealed an increase of 66 per cent in individual disability claims exacerbated by the PPI problems. Evidence – if any were needed – that if we hope to build on this modest increase in IP with more spectacular figures next year we need to sort the basics first.
That is why IPTF is working very hard to develop a meaningful consumer charter with a range of bodies. Working with consumer bodies is a major reality check. While unfailingly nice people, you are conscious that when one is speaking to them there is an elephant in the room and that elephant is actually attached to one’s back.
The elephant is the trust issue. You are aware that consumerists get so much bad feedback that they do not trust the industry further than you can throw even a medium-sized elephant. After all, why should they after PPI and all the other stuff?
The trust deficit that we outlined in the January’s syndicate research is a much bigger one than I realised. Stay inside your company confines or just venture out into industry meetings and you can persuade yourself that the industry emanates a rosy glow every time it helps a customer. It is a rosy glow that we may see, but one that is largely invisible to the public. The deep sadness is that this industry does do wonderful things on a regular basis but the value of these is compromised by all the elephant-shaped baggage we carry around.
While a step in the right direction, the 8.7 per cent increase was a drop in the ocean compared with the number of people who have not got the IP cover they need and who the industry has not tried very hard in some quarters to help. Sales of IP are up but need to be up much further. Sure, there are green shoots, but I want a jungle to grow. After all, I have an elephant I need to hide.
Peter Le Beau is co-chairman of the income protection taskforce.
Key points
The individual income protection market grew by 8.7 per cent last year after several years in the relative doldrums.
We have seen the publication of claims-paid statistics from all the major IP offices.
The trust deficit is much bigger than initially thought.
