The appeal follows the launch of the first Consumer Duty Alliance (CDA) Protection Forum, which revealed alarming insights about the barriers wealth advisers face when considering protection products.
The forum, attended by 112 wealth advisers looking to expand their knowledge on protection, highlighted several issues affecting the industry’s approach. The survey found that 57% of wealth advisers would be more inclined to make protection a core part of their proposition if they were better equipped to demonstrate the need for it to their clients. Additionally, 21% said that access to the right resources would encourage them to address protection needs more effectively.
These findings point to a significant gap in how insurers engage with wealth advisers, emphasising the need for a different approach to ensure protection is integrated into financial planning. The survey also revealed that 43% of wealth advisers cited a lack of necessary training or tools, as well as the complexity of arranging protection, as major obstacles to providing protection advice.
Another concerning statistic from the survey is that 92% of wealth advisers expressed a preference to write protection business themselves rather than refer clients to a protection specialist. This shows a clear rejection of the referral model, which had been anticipated to grow following the introduction of Consumer Duty regulations. Without a proper understanding of protection products and their value, wealth advisers are at risk of overlooking potential poor consumer outcomes and failing to protect their clients adequately.
Ian McKenna, CEO and Founder of Protection Guru, urged insurers to rethink their approach, stating, “These findings show a clear need for change in how the protection industry engages with wealth advisers. The protection market is failing to reach wealth advisers in the right way, and it’s time to overhaul the approach entirely.”
McKenna highlighted the common misconception among wealth advisers that their wealthy clients don’t need protection. However, he explained, “The level of wealth is not sufficient to eliminate the need for protection. Financial plans fail without income. If income is withdrawn to cover a serious illness, it can significantly impact long-term savings.”
Protection Guru’s focus has always been on providing impartial, technical analysis of protection products to advisers, which is why the company launched Protection Guru Pro in 2022. The platform helps advisers assess the full spectrum of protection products, including life insurance, critical illness, income protection, and business protection.
Looking ahead, Protection Guru plans to expand its services to better support wealth advisers and mortgage brokers. McKenna emphasised that this is a major opportunity for the protection market to address the disconnect with financial advisers, particularly as the market prepares for a broader focus on protection in 2025.
Protection Guru is the only service that allows advisers to assess the quality and value of protection products based on both price and performance, meeting the Financial Conduct Authority’s Consumer Duty requirement to assess value.
