Mortgage broker and Income Protection Insurance

theepw

Hello everyone,
I would very much appreciate people's advice, input and recommendations.

I currently live with my husband and we own our own house (currently have a mortgage - duration to be paid off over 21 years). We both work, however I bring home the majority of the monthly income. We don't have any children or dependants and it's just us living together. I am 33 years of age, fit and well and have no inter-current health issues / chronic health issues (*touches wood*) my other half is 15 years older than me.

I have been looking into getting Income Protection Insurance (aka PHI) - as if I did ever suffer a long term illness that would stop me from doing my own job for years to potentially decades, then I would want to have our monthly income relatively preserved and protected. Otherwise it would affect our ability to pay our mortgage and bills etc.

We are also currently just going through the completion stages of re-mortgaging our property in order to reduce our monthly mortgage payments and are using a mortgage broker for this (who reportedly search the whole market, are not restricted to set companies and do not charge a direct fee to the customer). The mortgage broker we are using is a: 'Mortgage & Protection Consultant'. She is also currently in the process of obtaining quotes for Income Protection Insurance for me as well.

Regarding exploring the option of Income Protection Insurance, I have spent time looking at this type of insurance on Youtube (advice videos) and the Money Saving Expert website :money: as well as these forums.

I know that some members of these forums have recommended getting an Independent Financial Adviser (IFA) to look into Income Protection Insurance. However, the moneysavingexpert website states that: '..income protection can all be complex products, with many exclusions. In some events, it can be done cheaply without an advisor, but those with less straightforward family arrangements or health issues, will find help useful'

I am therefore wondering: as my situation is a relatively simple one (no complex family arrangements or chronic health conditions), would you still recommend that I seek the advice from an Independent Financial Adviser.. Or... would the quotes from my current Mortgage & Protection Consultant be sufficient?

I guess I am not sure if a mortgage broker is 'just' a mortgage broker, or whether her being a mortgage and protection consultant would mean that the services provided would not be much different from using an IFA? And whether I could actually trust her search of the market for Income Protection Insurance that is most suited to me and my needs?

I would really appreciate your advice and opinions.

Many thanks

dunstonh

We are also currently just going through the completion stages of re-mortgaging our property in order to reduce our monthly mortgage payments and are using a mortgage broker for this (who reportedly search the whole market, are not restricted to set companies and do not charge a direct fee to the customer). The mortgage broker we are using is a: 'Mortgage & Protection Consultant'. She is also currently in the process of obtaining quotes for Income Protection Insurance for me as well.

Is that for both insurance and mortgages? A lot of mortgage brokers are whole of market for mortgages but limited panel or even single provider for insurance. The less reputable often use the whole of market side for mortgages to make it look like they are whole of market for insurance.

I know that some members of these forums have recommended getting an Independent Financial Adviser (IFA) to look into Income Protection Insurance. However, the moneysavingexpert website states that: '..income protection can all be complex products, with many exclusions. In some events, it can be done cheaply without an advisor, but those with less straightforward family arrangements or health issues, will find help useful'

PHI has products that can effectively be filtered into budget, standard and comprehensive. These are not official terms but just a way of filtering them as such. So, unless you have the means to know the different types and what they cover, you wont find it easy to compare.

Many of the providers of PHI will only transact via an intermediary. So, yes, you can bypass advice but you will be restricting the marketplace and you will need to do the research yourself.

I guess I am not sure if a mortgage broker is 'just' a mortgage broker, or whether her being a mortgage and protection consultant would mean that the services provided would not be much different from using an IFA?

Terminology can be confusing. For example, I am an IFA and a director of an IFA firm. However, my mortgage advisers in my firm are mortgage and insurance advisers. Not IFAs. Because the firm is an IFA firm (IFA is a term that applies to an individual adviser and to a firm type), the mortgage and protection advisers are whole of market. An IFA has investment permissions. Most IFAs (as individuals) do not do mortgages any more. Although the IFA as firm might. A mortgage and protection adviser doesn't do investments. So, they can have the exact same permissions as an IFA in respect of insurance.

If your mortgage & protection adviser is whole of market for insurance, then they are as good as an IFA in respect of insurance (all other things being equal).

theepw

dunstonh wrote: »

Is that for both insurance and mortgages? A lot of mortgage brokers are whole of market for mortgages but limited panel or even single provider for insurance. The less reputable often use the whole of market side for mortgages to make it look like they are whole of market for insurance.



PHI has products that can effectively be filtered into budget, standard and comprehensive. These are not official terms but just a way of filtering them as such. So, unless you have the means to know the different types and what they cover, you wont find it easy to compare.

Many of the providers of PHI will only transact via an intermediary. So, yes, you can bypass advice but you will be restricting the marketplace and you will need to do the research yourself.



Terminology can be confusing. For example, I am an IFA and a director of an IFA firm. However, my mortgage advisers in my firm are mortgage and insurance advisers. Not IFAs. Because the firm is an IFA firm (IFA is a term that applies to an individual adviser and to a firm type), the mortgage and protection advisers are whole of market. An IFA has investment permissions. Most IFAs (as individuals) do not do mortgages any more. Although the IFA as firm might. A mortgage and protection adviser doesn't do investments. So, they can have the exact same permissions as an IFA in respect of insurance.

If your mortgage & protection adviser is whole of market for insurance, then they are as good as an IFA in respect of insurance (all other things being equal).

Our 'Mortgage Broker & Protection Consultant' has been dealing with both our re-mortgage as well as Insurance.

She is also looking into Income Protection Insurance quotes for me as I had mentioned it her (the conversation came about when she re-negotiated my Life Insurance quote - she mentioned about whether I wanted to take out 'critical illness cover' and when I looked into it, I liked the idea of Income Protection Insurance more than critical illness cover (and could not afford both). So yes, she has been dealing with our re-mortgage and insurance quotes (life and income protection insurance)

When you said that: 'If your mortgage & protection adviser is whole of market for insurance, then they are as good as an IFA in respect of insurance (all other things being equal)' - are you essentially saying that as long as I double check and confirm that my broker searches 'whole of market' for Income Protection Insurance, then there is little added benefit in consulting with an IFA as well?