One of the most comprehensive studies of the mortgage protection market ever carried out, says AMI
Only 36% of mortgage customers remember protection being mentioned during their application, despite 97% of advisers bringing it up during the process, a new report from the Association of Mortgage Intermediaries (AMI) has revealed.
‘The New Protection Challenge' report, which AMI described as one of the most comprehensive studies of the mortgage protection market ever carried out, asked 5,000 consumers and 500 mortgage brokers about their protection experiences in September of this year.
The 32-page report revealed that buying a house or moving home are two of the three key drivers to buying protection, while home insurance is considered the most important insurance policy.
It also showed that less than a third of UK adults can correctly identify what income protection is, while over half of consumers do not believe claim statistics, which revealed that 98.3% of protection claims were paid in 2019 (ABI/GRiD).
The majority of consumers surveyed would prefer protection to be arranged before or during the mortgage process, rather than after, while one in seven mortgage brokers refer protection to a specialist.
The study also revealed that Covid-19 has not impacted the likelihood of getting protection for the majority of consumers.
The report, revealed as part of a webinar this morning, coincides with the launch of the AMI Protection Specialists Group (PSG), which combines protection market leaders, with proposition directors and practitioners across a range of firms, networks and mortgage clubs.
Robert Sinclair, chief executive of AMI said: "The challenge our industry faces is: how do we get the consumer onside and trusting this market during their journey through mortgage advice to protection advice? The research shows a great opportunity for advisers to better engage with customers. Our collective task is to encourage advisers to rise to the ‘new protection challenge'.
Chair of the Protection Distributors Group, Alan Knowles added: "The research is very enlightening and could suggest that if protection is being discussed with mortgage customers that it's not always being done in a manner that impresses its true value and importance."
Vikki Jefferies, proposition director at Primis said: "With less than a third of UK adults able to correctly identify what income insurance is, it will be up to advisers to help boost consumer awareness on this product."
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Only 15% of advisers refer mortgage clients to a specialist