In an ideal world, every time an individual bought a house, cemented a long-term relationship or had children, they would call an adviser to buy some protection.
But, of course, it doesn't work that way: the UK has a huge protection gap.
In 2023, Swiss Re put the UK mortality protection gap at £2.3 trillion, suggesting that the average UK household is underinsured for life to the tune of £200,000.
Drewberry Insurance, meanwhile, reports that only 15% of people have critical illness cover and just 9% hold income protection. Overall, the Financial Conduct Authority says 58% of UK adults do not hold any pure protection products.
The gap is particularly concerning when set against the limited financial resilience of many UK households.
Vitality research found that 56% of mortgage holders would be unable to maintain their mortgage payments for longer than six months if their income stopped, while 62% said losing their home would be their biggest fear if they became too ill to work.
Andy Philo, director of strategic partnerships at Vitality, says this underlines why protection needs to be considered as part of the homebuying process, rather than treated as an optional conversation once the mortgage has been arranged.
Creating a home is an exciting time, but it is also when clients are taking on one of the biggest financial commitments of their lives. Protection should not be seen as an additional purchase at the end of that journey. It is part of making sure the life they are building, and the income supporting it, can withstand something unexpected."
Customers need encouragement to buy protection. According to the regulator's interim report on protection distribution, around 80% of protection sales are through intermediaries. Of the 58% that don't hold any protection, 59% hadn't ever considered the need.
That puts mortgage advisers in a unique position to talk to people about protection, says David Hollingworth, associate director, communications at L&C Mortgages.
Mortgages are critical in this as it's so often the trigger for people to see why they need to think about protection."
With customers on the cusp of taking on such a large and emotionally-weighted debt, they can clearly understand the financial consequences of illness, injury or death.
"In recent years, advisers have increasingly looked to embed protection into the conversation. That doesn't mean it's perfect, but it's something we're constantly looking to improve."
Even though most L&C customers will be put in touch with a protection specialist after the mortgage application, Hollingworth says advisers should still be talking about protection right from the start.
It's about trying to introduce the protection conversation earlier. The risk is you just talk about mortgages and then suddenly they feel that they're being sold protection."
In this respect, Roy McLoughlin, founder of the Protection Distributors Group and commercial consultant at Plan Money, does say significant progress has been made. "If you were to look at fact-finds from 20 years ago, the protection part was buried at the end. Now, quite rightly, you've got mortgage brokers realising that they have to ask these questions very early in the process."
The challenge for brokers now is that costs of living are rising and borrowers are particularly price sensitive. "There are lots of costs coming at you when you buy a new house," says Hollingworth. "The initial reaction is to try and avoid any costs you don't need to incur."
But the financial pressure clients feel at the point of purchase can itself make protection more important. According to Vitality research, 37% of adults would not feel financially confident if their household income stopped unexpectedly.
Philo says advisers can add value by helping clients test the assumptions beneath their financial plans before illness or injury turns them into an immediate problem.
Many assume their sick pay will carry them through a period of illness and that only tends to become real when something goes wrong and when the choices available have already narrowed. The conversations worth having are the ones that happen earlier, when people are well and have the time and headspace to understand what they actually have in place."
For Hollingsworth, "It's about explaining that in avoiding a cost today, you're potentially setting your family up for a much tougher time in the future if something happens. You have to have these difficult conversations and make people understand what the benefits are and how they relate to them and their family."
He adds: "Advisers have to communicate that you can tailor the cost and that some protection is better than none. This is a critical part of what an adviser can do for that customer, which they aren't going to get from an online search."
McLoughlin says it's particularly helpful if advisers have some case studies in their armoury. "The challenge with insurance is people think these things won't happen to them. A case study contradicts that. Every time I have had a case where someone gets ill I plead with them to tell their story."
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Brokers can also help clients understand what's available from the state, in terms of benefits, and the level of support they can expect from their employer. "It's incumbent on us to help clients establish what they would be entitled to," says McLoughlin.
That can even include offering to look at their workplace provision, to help them understand what they have (or haven't) got. "Often sick pay is only at employer's discretion. And, where they have death in service, it's about finding out how much and explaining that wouldn't go with them if they moved job."
But perhaps, most importantly, McLoughlin says advisers must make protection a business priority and be genuinely motivated to get clients the cover they need, not just on their mortgage but on their lifestyle overall. "If any broker doesn't have the right attitude, that will be perceived by the customer quicker than you think."
He adds: "It's a big word but there's a responsibility on mortgage brokers to bring the subject up, or if they don't have the facility to do it, have a signposting agreement in place."
