Protection
Intermediaries must be more innovative in creating greater sales opportunities if the protection market is to rouse itself from its slump, delegates were told.
Addressing an audience of intermediaries, Trevor Head, protection account manager at AXA, claimed that influences such as the housing market are forcing IFAs to become more imaginative in securing new business.
"The protection market is falling year on year; the housing market, to which 53% of all protection business is linked, has fallen flat and now there are fewer rebroking opportunities than ever. Three years ago definitions were wider and re-broking was a possibility, but not anymore," said Head.
"Things don't look likely to get any better in the short term as the cost of Hurricane Katrina is predicted to be around $60bn. This is going to tie up reinsurer capacity for some time and therefore inevitably means higher rates," he added.
Head went on to highlight the growing list of obligations faced by advisers, such as increased levels of compliance, paperwork and disclosure risk, but claimed that new developments may redress the balance in favour of the intermediary.
"A good point-of-sale system and a quality menu product should allow IFAs to get all the information they need in a single client visit and therefore save time and money.
"By loading a provider extranet on to a laptop an adviser can tweak the quote in front of the client without producing reams of paper. Then the application can proceed online or through tele-underwriting which eliminates the need for medical questions.
The role of intermediaries in non-disclosure also came under scrutiny. Head warned of the growing culpability that advisers face if a claim is rejected on those grounds. "There is an increasing spotlight on the adviser with regard to responsibility for disclosure and the way they obtain it. If IFAs are looking to protect themselves, tele-underwriting is clearly the single best way to prove non-disclosure in the event of adjudication," claimed Head.
