How to help clients with multiple protection needs

This article is part of
Guide to managing obstacles in protection

How to help clients with multiple protection needs
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A frustrated IFA has urged protection providers to introduce a universal application form to reduce the time it takes to apply and receive quotes for clients with multiple protection needs.

Ricky Chan, director at IFS Wealth & Pensions, spoke out about the arduous process of finding appropriate cover for clients who have complex protection needs and require a mix of policies such as life, critical illness, or income cover. 

This often means they require a variety of providers because the same insurer is not always the most competitively priced in each area or does not offer the same level of cover and benefits, leading to extra paperwork for both advisers and their clients, Chan says.

He adds: “I think providers can do more to assist clients with multiple needs during the application and medical questionnaire stage.

"For example, with enhanced annuity quotations, a ‘common quotation’ form can be used and sent to multiple providers to receive a quote. If the same could be done with protection, and perhaps the client can authorise the sharing of GP reports among insurers, then this would save a lot of time and I imagine costs to the insurers too. It should hopefully lead to more transparent pricing for those with underlying conditions too.”

Chan points out that one of the difficulties with the current application process is that different providers often ask the same question slightly differently.

An example of this from his experience has been one provider asking whether the client has had a particular condition in the past five years, while another provider has only required the information for the past two years.

To make matters worse, different providers have different systems to contend with as some only have an online process so that clients can complete the questionnaires at their own convenience, while other providers will only offer a long paper-based application, making a lengthy process even more laborious. 

"This might not sound so bad for young clients with no underlying health conditions," says Chan, "but for someone with underlying conditions this may not be the end because if the policy is rated or exclusions have been applied after medical underwriting then it may be best to submit a further application with another insurer to see if this offer can be improved upon. And then a further wait as the new insurer is likely to request a new GP report. Although pre-sales medical underwriting departments have been invaluable for advisers to discuss cases, they can’t provide guarantees of the underwriting outcome until they’ve seen GP reports and test results.

“Even assuming everything went smoothly, there may yet be multiple trust documents to complete for the client if there were different insurers, which means more paperwork and time required from trustees and witnesses too.”