Income Protection (IP) ‘holds the key to keeping on top of the Mortgage Market Review (MMR), Cirencester Friendly has said.
John Bridge, director of sales and marketing for Cirencester Friendly (pictured) said he believed an adviser would fail to meet regulatory requirements if they did not recommend IP to clients.
MMR has set out a tougher onus on lenders to check whether customers can afford to pay their mortgage.
Bridge said: "Encouraging the uptake of IP to safeguard the income of the borrower in times of illness must be a vital aspect of mortgage advice particularly after MMR.
"IP can provide a cover of between 50% and 75% of mortgage applicant's gross earnings. It provides a protection that gives advisers and lenders the peace of mind that the mortgage payments are met and the borrower's ongoing standard of living is maintained."
Bridge concluded: "The good news for IP providers is advice about insurance & protection is now part of the adviser / client dialogue - but this is not new! The Mortgage Code, FSA and now FCA have always required that an adviser ensures their client is at the least is aware of the benefits of Income Protection.
"Indeed I would state that an adviser fails to meet the MMR regulatory requirement if they allow their client to continue without any form of income protection when it is clearly required."
Earlier in the week Zurich highlighted the need for clients to take protection advice as part of affordability requirements.
