Protection  

Protection initiatives are floundering, says Baigrie

The managing director of London-based protection distributor LifeSearch said the Protection Sellers Code of Conduct had been taken up “enthusiastically” by IFAs but not all insurers were insisting distributors follow its principles, first devised in March 2012.

Speaking at the LifeSearch annual awards, he said: “Larger providers have tended to focus on distributors’ viability post-RDR rather than how to make the selling process more transparent and consumer-friendly.”

The Protection Sellers Code of Conduct was introduced to prevent mis-selling of policies post-RDR, amid fears that advisers would flock to a market exempt from the regulator’s crackdown on commission.

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Mr Baigre’s comments were echoed in the keynote speech given by Roger Edwards, the former managing director of Bright Grey, who suggested the industry had yet to “wow” consumers with a truly innovative product.

He said: “Which provider will be next to open the medical dictionary, find a condition with a three-line Latin name that consumers do not understand and add it to its critical illness policy? Similarly, providers are not really finding ways to reduce premiums if they apply a loading post-application. When are we going to devise a product that makes people stop and think?”

Background

LifeSearch revealed a 13 per cent increase in gross profits to £4.5m in the financial year ending August 2013, with a 13 per cent rise in turnover to £18.1m. The firm processed protection business worth £480m during that period.

Joss Harwood, co-director of Eldon Financial Planning, said there needed to be a “heightened understanding” of when and how protection should be sold. She said: “Wealth management is higher up the agenda now but intermediaries cannot neglect the fundamentals.”