Life Insurance/Income Protection Insurance - buy through broker or direct?

nik_k

We're in the process of buying our first home, and, as such, are currently looking at Life Insurance and Income Protection Insurance. Our mortgage consultant, whom we used to secure our mortgage, is able to offer advice on insurances too, and she has run a few illustrations.

Her advice is to go with Aviva, as their policies are fair, wide-ranging, and their payout percentages are good.

I have run an enquiry via money.co.uk (ActiveQuote) and appear to have found the same policies as she found, albeit cheaper. Therefore, is there any benefit of buying through a broker (her), or are there potential savings to be made by buying directly through my own research? My initial thoughts were that she would be able to secure better premiums, but perhaps that wasn't correct?

SonOf

Our mortgage consultant, whom we used to secure our mortgage, is able to offer advice on insurances too, and she has run a few illustrations.

If the mortgage broker tied to an insurer or whole of market?

I have run an enquiry via money.co.uk (ActiveQuote) and appear to have found the same policies as she found, albeit cheaper.

You will find it a little cheaper as if you buy direct, you get reduced consumer protection. The mortgage broker is liable for advice given and cost of advice has to be factored in.

Do make sure you are comparing like for like. Countless times we have seen pepole on this site say they get a lot cheaper only for it to turn out that they had reduced the cover on their own sourced quotes (such as mixing up terminal illness cover with critical illness cover or using a different level of income protection).

My initial thoughts were that she would be able to secure better premiums, but perhaps that wasn't correct?

A comparison site will nearly always be cheaper on life assurance but most comparison sites have poor coverage of income protection and that is one area a whole of market adviser can add good value.

garth549

There's no benefit to buying through a broker other than the fact they have experience setting up these policies. If you're not confident doing it yourself it's probably better to use one. You do also have some legal comeback against them if they give you bad/misleading advice.

If you are confident then do it direct with an insurer and you can nab the commission the broker would have received (cashback). I got £200 for my Aviva life insurance via Quidco earlier this year.

nik_k

SonOf wrote: »

If the mortgage broker tied to an insurer or whole of market?

Whole of market for sure

SonOf wrote: »

You will find it a little cheaper as if you buy direct, you get reduced consumer protection. The mortgage broker is liable for advice given and cost of advice has to be factored in.

Do make sure you are comparing like for like. Countless times we have seen pepole on this site say they get a lot cheaper only for it to turn out that they had reduced the cover on their own sourced quotes (such as mixing up terminal illness cover with critical illness cover or using a different level of income protection).

OK, point taken, and this is where I think the differences start to arise. She mentioned that she'd got the Income Protection index linked, which I don't believe the comparison site quote was. Though there seemed not to be a way of making it index linked that way...

SonOf wrote: »

A comparison site will nearly always be cheaper on life assurance but most comparison sites have poor coverage of income protection and that is one area a whole of market adviser can add good value.

Yeah, I can see that comparison of Income Protection quotes is a lot less widespread than Life Insurance. Good advice!

nik_k

garth549 wrote: »

There's no benefit to buying through a broker other than the fact they have experience setting up these policies. If you're not confident doing it yourself it's probably better to use one. You do also have some legal comeback against them if they give you bad/misleading advice.

If you are confident then do it direct with an insurer and you can nab the commission the broker would have received (cashback). I got £200 for my Aviva life insurance via Quidco earlier this year.

I'm confident, in so much as I always use these sytems to get better deals on my other insurances. However, it's the added extras like the aforementioned index linking on the Income Protection that I don't seem to be able to access myself. Maybe this would change though if I actually spoke to one of the advisers in the insurers. I'm not against making some pennies back through Quidco etc

Weighty1

Did your mortgage broker add Global Treatment onto the plan? This can't be obtained by going direct and, I believe, is only available through brokers regulated to give advice.

It adds £4/month to the plan but is a fantastic benefit as far as I'm concerned.

Weighty1

Another point to consider, if your mortgage broker hadn't even brought up the subject of income protection, would you have even known about it or considered taking it out?

Whilst I'm not saying you owe the broker anything sometimes you need to take a look in the mirror and consider the advice you've received and whether it's good advice and whether saving a couple of £'s/month is worth closing that channel of advice, cos let's face it, if you arrange this yourself then the mortgage broker is unlikely to ever bother giving you advice again.

The very fact that they've recommended an index-linked IP plan with a provider that does have a top drawer policy makes me think their advice IS good.

nik_k

Weighty1 wrote: »

Did your mortgage broker add Global Treatment onto the plan? This can't be obtained by going direct and, I believe, is only available through brokers regulated to give advice.

It adds £4/month to the plan but is a fantastic benefit as far as I'm concerned.

Ummm, good question! I have no idea, so will check the info she sent through

nik_k

Weighty1 wrote: »

Another point to consider, if your mortgage broker hadn't even brought up the subject of income protection, would you have even known about it or considered taking it out?

Whilst I'm not saying you owe the broker anything sometimes you need to take a look in the mirror and consider the advice you've received and whether it's good advice and whether saving a couple of £'s/month is worth closing that channel of advice, cos let's face it, if you arrange this yourself then the mortgage broker is unlikely to ever bother giving you advice again.

The very fact that they've recommended an index-linked IP plan with a provider that does have a top drawer policy makes me think their advice IS good.

I have no doubt her advice IS good, but I just get myself confused that her prices were higher than mine going direct. Some realy good valid points raised though. FYI, we have instructed her this evening to go ahead with her choices (but I'll check re global treatment!)