Advisers: Are you neglecting matters of the heart?

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Nearly two-thirds of women haven’t spoken to a financial adviser about protection insurance, according to research from our latest ‘Protection matters: does women’s financial planning match their priorities’ report. This is a large market for you to target, and there are some particularly receptive sectors to focus on.

But before looking at what new business opportunities to prioritise, it’s important to understand some of the most common hurdles you’ll have to overcome, dispel the myths and break down the barriers to buying protection.

Protection offers excellent value at affordable premiums

The perceived cost of protection remains the biggest barrier for women and 48% say they can’t afford it. Therefore it’s crucial to demonstrate just how affordable policies are in many cases.

For example, a 35-year-old non-smoking female could take out £90,000 of life protection, over a 25-year term, for just £7.01 a month. This is significantly cheaper than the average family trip to the cinema that comes in at £38.99. In fact, it’s not far from the average £5.39 we pay for a bottle of wine, although the benefit provided by life insurance is significantly more valuable.

Interestingly, we found that two in five women (42%) said they would rely on savings if they couldn’t work for six months. But we also found that many underestimated the monthly cost of running a house, meaning their savings wouldn’t last for as long as they think. And that’s before considering the added costs that often come with illness or disability. Macmillan Cancer Support found that in 2013 cancer cost individuals an extra £570 a month.

The right protection safety net can help your clients meet their financial commitments when dealing with accident, illness, disability or death. It can also make sure their partner and their children don’t suffer financially as a result.

Such policies are called upon each year in large numbers and in 2015 there were over 158,000 claims made on protection insurance policies.

Seeking advice on protection

Across the board, we found that 17% of women would prefer to buy protection insurance from a financial adviser. Even more encouragingly, we found this figure rose to 30% for employed senior managers and 36% for directors.

We believe this creates a very attractive opportunity when working in the corporate workplace to offer personal protection advice to workplace pension scheme members. And if you’re not talking to women about protection, then you can be sure your competitors are making inroads into this market.  

The more senior women become in the workplace, the more likely they are to have some form of protection. We found that 79% of women in senior managerial positions had some form of protection in place.

If you can establish relationships with women in fast-track positions or developing careers, it’s likely they’ll become more interested in protection planning as they become more senior, enabling you to strengthen your relationship and create new revenue streams for your business.  

Where employed women are not in senior managerial positions then only 40% have some form of protection in place and only 20% have spoken with a financial adviser about protection.

There is a significant opportunity, therefore, to explain to this group of women the financial security that protection insurance provides; to highlight the difficulties of coping without it and to demonstrate that the monthly cost of life insurance can be little more than the price of the average bottle of wine.

If we, as an industry, can communicate these message in a way that interests and educates women in these less senior positions, there’s an excellent opportunity to break down many of the existing barriers to them buying protection. This will help secure their financial positions in the event of accident, illness, disability and/or death, and enable you to develop your business. 

Be proactive on protection

We’ve made it easier to get these conversations started with new clients by creating a suite of letter templates for you to use. These letters are aimed at clients, at different life stages, reminding them of the importance of protection insurance and the value of the financial safety net it provides.

The templates are available online in our toolkit and using these documents will make it quick and easy for you to make initial contact with potential new leads.

Protection insurance lies at the heart of effective financial planning - it’s time to take the message to a wider audience.