Covering your back with a new mortgage - critical illness?

kingstreet

droiderm wrote: »

I was just making the point that most people on here get commission for selling insurance products. I guess it's not the best place to get a balanced view.

I find that a bit wearying, to be honest.

If I give the impression that my help is based on my view of the world as a potential "earner" I am doing something seriously wrong.

5,000 thanked posts in less than two years and not a penny sought, or taken, from doing so.

Do you think income protection would be a bad idea for the OP's consideration, or just critical illness cover?

droiderm

I have no view on what insurance products the OP should or shouldn't take out. I am not in a position to do so. Even if I was, it's a personal decision. I was pointing out a potential pitfall, which was topical and in the news. It's awful. And I do think a 90% payout rate is awful, don't you? That's people who need help , when they have much bigger things to worry about, when they think they are covered. That really bothers me.

I wasn't pointing to anyone in particular, or saying that everyone is like that. My personal opionion is, and always has been, I can't fully trust anyone who earns money depending on what they sell me. That's just the way I am.

Reading back I can see the advice given to the OP seems good advice.

But, I still stand by it's not the best place to get a balanced view. Do you think it is?

kingstreet

Until the consumer is prepared to pay for advice and that is separated from the sale of a product, we have the system we have.

We also have a massive protection gap - where through ignorance, or mistrust of advisers, providers, products, whatever, people are going through life unprepared for the unexpected.

Balance? Yes, I think what people are told on here is pretty balanced. If they come here with a misapprehension about a particular product they are given factual information about products and alternatives. I can only talk about the things I say and the reasons I say them, though.

The best alternative is to pay for advice, like I said at the outset.

Coming back to the critical illness claim stats, it is regrettable that even 1 person in 100 fails to get a claim settled. However, that has to be put right by all of us - professionals, consumers and regulators. It's too easy to seize on a headline, like the "pins and needles" thing from earlier and see the big, bad insurance company as the villain. Sometimes, we're all guilty of seeing and hearing what we want, rather than what's actually there...

JuicyJesus

droiderm wrote: »

I have no view on what insurance products the OP should or shouldn't take out. I am not in a position to do so. Even if I was, it's a personal decision. I was pointing out a potential pitfall, which was topical and in the news.

But which you admit yourself you know no detail on (as per dunstonh's post) other than the headlines in the news. Is that a sound basis to point out "pitfalls" on a financial product which could have major implications for anyone reading it and taking heed of it? It's like saying "you shouldn't buy a car, my grandad had a car and he died in a massive four car pile-up that then exploded" when what actually happened was the result of your grandad being p*ssed out of his head and trying to race a petrol tanker down the M3 with a boot full of fireworks and lighter fluid.

dunstonh

Just to add a balance to the discussion, of course mortgage brokers are going to be for it

I'm an IFA and fee based. So, how do you explain me being positive towards it?

I was just making the point that most people on here get commission for selling insurance products. I guess it's not the best place to get a balanced view.

That isnt fair on those of us that are fee based and responding on this thread and if you had been around longer you would recognise the quality of the poster that is responding on this thread and that they have no issues in dealing with the bad as well as the good. So, your comments are unfounded and unfair.

That means 1 in ten people don't get a pay out.
Isn't that scary? 1 in ten people reading this won't get a payout.

It isnt scary. Non-disclosure is only around 2%. The biggest rejection is not covered. i.e. claiming for something the policy does not cover you on. All insurance policies have that.

I honestly couldn't remember the last time I went to the GP, and why. I would imagine a doctor saying to lots of people everyday, you need to lose half a stone, or do more exercise, or cut down on the booze a bit. I am in most of these cases, the patient won't consider it a major issue.

Which is why the insurers only ask for minor ailment details going back 3-5 years. you should be able to remember that. If you had been sent off for tests due to organ damage and told you had to reduce your alcohol content, they are not things you forget.

But, I still stand by it's not the best place to get a balanced view. Do you think it is?

Yes it is. You can see posts from the same posters on this thread telling people on other threads things to avoid or things that are a waste of time. So, for you to accuse bias is unfair and wrong.

droiderm

kingstreet wrote: »

Coming back to the critical illness claim stats, it is regrettable that even 1 person in 100 fails to get a claim settled. However, that has to be put right by all of us - professionals, consumers and regulators. It's too easy to seize on a headline, like the "pins and needles" thing from earlier and see the big, bad insurance company as the villain. Sometimes, we're all guilty of seeing and hearing what we want, rather than what's actually there...

I largely agree with what you say.
From my lay mans view I heard that what you guys may consider a scare story just the other day, of which Martin Lewis was talking about.

As it's was topical, I just thought it right to point out a pitfall of such products. Maybe the OP's adviser is on top of that, maybe they're not. Who knows?

droiderm

JuicyJesus wrote: »

But which you admit yourself you know no detail on (as per dunstonh's post) other than the headlines in the news. Is that a sound basis to point out "pitfalls" on a financial product which could have major implications for anyone reading it and taking heed of it? It's like saying "you shouldn't buy a car, my grandad had a car and he died in a massive four car pile-up that then exploded" when what actually happened was the result of your grandad being p*ssed out of his head and trying to race a petrol tanker down the M3 with a boot full of fireworks and lighter fluid.

It's absolutely a sound basis, as the law is changing next year around this area.

It has absolutely nothing to do with your car analogy.

droiderm

dunstonh wrote: »

I'm an IFA and fee based. So, how do you explain me being positive towards it?

I never said you were...

dunstonh wrote: »

That isnt fair on those of us that are fee based and responding on this thread and if you had been around longer you would recognise the quality of the poster that is responding on this thread and that they have no issues in dealing with the bad as well as the good. So, your comments are unfounded and unfair.

I previously agreed that the advice given was good advice.
I was specifically responding the the OP's comments around insurers not paying out, of which I raised a perfectly reasonable topcial story of which the OP may not have heard.

dunstonh wrote: »

Which is why the insurers only ask for minor ailment details going back 3-5 years. you should be able to remember that. If you had been sent off for tests due to organ damage and told you had to reduce your alcohol content, they are not things you forget.

I accept that, however that wasn't in the media stories I read/heard.

dunstonh wrote: »

Yes it is. You can see posts from the same posters on this thread telling people on other threads things to avoid or things that are a waste of time. So, for you to accuse bias is unfair and wrong.

The whole insurance selling thing get's me. I see why it's a perfect time to sell insurance. I have even seen threads on this board warning "watch they don't try to sell you their insurance products" made by mortage advisers.

Maybe I am getting my dislike for sales people mixed up with what can be/might be a worthwhile product to have. Not everyone has it, and not everyone wants it. However some high pressure sales tactics (I am not impying anything there) can get some people signing on the dotted line.

My point still is, most people on this board will recommend insurance products, it's their job and I understand that. I am not saying people are selling on here.

Just so I am signing on the same hymn sheet, everyone thinks everyone should have these insurance products?

JuicyJesus

Just so I am signing on the same hymn sheet, everyone thinks everyone should have these insurance products?

In general terms, if you have dependents (people who would be significantly financially disadvantaged or even rendered homeless by your passing or having to leave work due to a critical illness) it makes perfect sense to have life insurance and critical illness cover. This is not advice, I hasten to add, this is speaking in very broad generalities. The best way to find out of it makes financial sense for you personally is to consult an IFA.

It has absolutely nothing to do with your car analogy.

It's a perfect analogy. The media story of the man whose life insurance claim was turned down because of "pins and needles" excludes a vast amount of detail in order to bias it in one particular direction, and a direction which might stop people from taking out cover for which they have a financial need. If all you ever heard about cars was that they were dangerous machines, one of which killed someone's grandad and blew him apart, you'd think "f*ck me I don't want a car, they're death traps", but if you heard the cause was him drunkenly recreating Grand Theft Auto on a motorway with a BP lorry while carrying lots of flammable materials the thought wouldn't be "cars are death traps", it'd be "it's not the car's fault your grandad's a reckless bell end".

kingstreet

droiderm wrote: »

My point still is, most people on this board will recommend insurance products, it's their job and I understand that. I am not saying people are selling on here.

Just so I am signing on the same hymn sheet, everyone thinks everyone should have these insurance products?

We'll recommend a product to meet a clearly defined need.

A person who is single with no dependents has no demonstrable need for life cover. Someone in a group PHI scheme has no need for income protection cover.

When I establish a need, then make a recommendation for a product to meet that need, I set out the provider, cover, term etc and ensure the recommendation is affordable, then provide a verbal statement of price and follow that up with a personalised demands and needs statement explaining how and why that product best suits the applicant's needs.

Once that is done, a compliance professional scrutinises the documentation down to what time the illustration was done and how that compares to the timestamp of the last version of the factfind and any notes which have been added.

Then, if the client decides to cancel the policy after a few months, the bulk of the commission paid to me is clawed back by the insurer. I only earn all I am paid if the policyholder pays the premiums normally for at least four years, although one or two insurers use two.

I have a direct interest in doing the job cleanly, properly and ensuring the client fully understands what he has and why he has it. Losing a case a year down the road makes this job very precarious, where you are doing a case today to replace one you did last year.