Sarah Moore, Head of Proposition, Auxilium Partnership.
Protection insurance. What a thing. There’s a £2.4 trillion protection gap. People have unprotected loans and income, and are leaving themselves and their families vulnerable. They take loans – mortgages, credit cards, car finance; they rely on an income to pay those loans and bills. They have dreams and aspirations for the lives they want for themselves and their families, yet more people insure their ruddy mobile phones and their pets than their income, or themselves. WHAT IS WRONG WITH US?
People need protection. We shouldn’t be allowed to take loans without being sure we (or our families) can pay them back even in the event of sickness, unemployment, critical illness or death. It’s that simple, it really is! So having worked with insurers, service providers and advisers during my protection career, I can’t understand how we, as a collective industry, are not smashing this out of the park! It beggars belief.
Protection insurers spend tens (if not hundreds) of thousands of pounds on marketing, PR, sponsorship, and celebrity spokespeople. They create countless sales aids, brochures, presentations, and tools purely so advisers can sell protection to their clients - and it makes no difference, at all, to that £2.4trillion gap.
What the hell are we doing wrong? Well, for a start, £2.4trillion is a ludicrous sum. That’s not a stick to beat us with, that’s General Sherman, the largest tree in the world, a giant sequoia, with a volume of 52,000 cubic feet. And insurers and advisers are the size of ants by comparison.
£2.4trillion needs breaking down. Insurers, instead of wanging on about the size of the gap or lobbing your latest research over to advisers and consumers alike and then sitting back saying, ‘there you go, there’s some nice statistics for you to use’, (yawn) let’s shake things up.
So, with my £3million (thank you very much @protection_rev) let’s interact on a human-to-human level. Not a statistician level. Let’s make the need for protection insurance relevant and relatable on an emotional level. Let’s explain it to our audience, the Great British public (GBP) like we explain it to our own friends and families.
How about working with Martin Lewis – the Money Saving Expert himself – (my money, my pitch! He’s not THAT expensive) and get the message about protection insurance out there from someone the nation trusts. Because – and this may be a bitter pill for the industry to swallow – that isn’t us. Like it or not, the GBP don’t trust insurers (put your hand down at the back with your engagement scorecard burning a hole). They don’t. They (broadly speaking) believe insurers will do pretty much anything to wriggle out of paying a claim. And let’s face it, that isn’t wholly unfounded, ‘you can dispose of those water-damaged kitchen units Miss Moore’: unnamed insurance provider circa 2002. ‘You disposed of those units. We’re only giving you £4.50 since we don’t know what they were worth’: same unnamed insurance provider approximately 1 week later. And don’t even get me started on the pet insurer I had to threaten with FOS. Both paid out in the end but a less bloody-minded person (or one without a medical underwriter buddy) would maybe not have had the same result. That’s me, 1 person. 2 experiences. 2 poor experiences of insurers, that I can recount off the top of my head.
And advisers don’t get away scot-free either, I recall research done by a large insurance provider around 2014, where many people asked said they felt an adviser ‘would try and sell them products just to earn the commission’. How damning is that?
So, we need someone the GBP can trust. Someone who knows their onions… Martin would talk to people about their financial situation. He would explain how to break down their protection needs in simple language with massive diagrams, there might even be a ‘comedy’ sketch to keep engagement high.
Then I’d suggest he sits down with our case study GBpers and lets them talk about what they believe their own protection needs to be following said presentation.
Next, why not invest some cash on ‘giving’ a protection adviser to a variety of families, couples, singletons. The adviser would live with their members of the GBp for a week, with a view to really getting into the minutiae of their day-to-day lives. They’d spot the takeaway lattes, Sky subscriptions, mobile phone upgrades and have them do a quick tally of how much that all adds up to. Let them watch mum or dad (who ‘doesn’t work’) run the kids to ballet, football, Tai Chi and trampolining and add up the cost of the fees and subscriptions plus the cost of taxis if mum/dad weren’t around. Let them listen to the teens chat about what university they want to go to or what course they want to study, or how they plan to ‘intern’ for a year whilst staying at home, rent-free with the olds.
Then once these real-life, real-time warts and all fact finds have been done, let’s get our GBP case studies, their free adviser and Martin together in a room to review the findings. My money’s on them bringing home a dash of sobering reality. Things cost more than you think. Things you don’t think cost anything would cost a lot if you had to replace them and… there is ALWAYS going to be something that trips you up – after all ‘Man plans, and God laughs’.
Once our groups have reviewed their real dreams and aspirations, outgoings and expenditure, the advisers, along with Martin, would present tailored protection plans that cover reality and compare them with the initial needs that the GBPers outlined back before the live-in happened. I’m sure they’d be found lacking because a half-hour telly programme isn’t enough to explain properly how to set up a comprehensive protection plan. No matter who hosts it.
And if that comparison isn’t enough to change the perception of need, Martin would match our GBP-ers with people like them. They’d see a family set up that mirror theirs but that included people who had been through injury, illness, or bereavement. They’d hear about their experiences and talk about how cover might have, or did, help them face their challenges and come out the other side.
Of course, all of this depends largely on a speedy vaccination programme for Covid-19… I remember tweeting back in January 2020 that if I got one more alert from the BBC about single-figure cases of Covid in the UK, I would throw my phone out the window (it’s ok, it’s insured). But of course, I didn’t know the significance of those single numbers. I didn’t understand the impact they would have on me because no-one took the trouble to explain it to me. By the time they did, it was too late for us all, the infection was here. We did nothing, we knew nothing. Does that sound familiar? As an allegory for protection insurance, it’s pretty apt. And protection insurers saw a boom in sales because of Covid.
People, should it take a pandemic? A "coronapocalypse", to show us the value of protection insurance? Or should it just take the right words from someone we trust, taking the time to treat us like adults and explain just exactly how to take our protection needs into our own hands? Because I don’t really have £3m from Protection Review, and Martin Lewis isn’t coming to a screen near me any time soon to talk about critical illness cover. But we do have a wealth of protection insurance providers with products to sell and around 30,000 financial advisers in the UK who can take up Martin’s mantle and be the person we can trust.