Home / Life Insurance for First Time Buyer

lamialex

Hello,

I am in the process of buying my first property. I used a mortgage broker and now this person  is trying to help us with Home Insurance and Life Insurance which we never had before so I am guessing they are also an insurance broker. Now I didn't expect having to use an insurance broker, I have always used the comparison websites for other insurances (car/travel). I am a bit reluctant cause it seems to me that the person is trying to push us to use their services so she can get her commission but she tells me this:

Insurance wise it's entirely up to you who you/ what you do. All I will said is products direct with insurers are very different to via a broker. For example a lot of them cover less conditions for critical illness on their none broker products, and give you access to counseling, second medical opinions etc which are free but they don't include on their products online. Also if you're wanting to protect your income it's and advised only product which means you can't do it online it has to be done with a broker
We get a commission but not necessarily more expensive. The majority of personal insurance comes from brokers not direct which is why it's not always more expensive and why insurers make better products only available to us. 
But equally you pay for what you get with insurance, you'll never get high quality cover for a low premium as insurers have to ensure the premium covers there risk.
Even if you're just looking at life insurance a lot of the cheaper insurers such as beagle Street don't advertise their claim statistics because they're not good enough to shout about. Where as your better insurers will tell you what % of claims they pay out on. Some insurers don't pay out for suicide, others do. Some don't provide early payment if your terminally ill where as others do. Some will pay your premiums for you if you're signed off work sick etc there's more to insurance that just the cover amount and the premium you pay.

so  when it comes to home / life insurance is it indeed better to use an insurance broker? 

Thanks

SaverRate

Home insurance I always use comparison sites/go direct to insurers but why not get a quote from the broker then a quote from comparison sites/companies direct and compare but make sure they are quoting like for like? I would recommend ensuring trace and access, legal cover and home emergency cover are included. 

Life and Income Insurance I use a broker and would recommend it especially if you have medical conditions - Personally I now only use use Alan Knowles at Cura Insurance after having issues with other brokers - Life Insurance | Critical Illness Cover | Income Protection (curainsurance.co.uk)

MovingForwards

My broker asked me if I wanted help sorting insurances out and I said no. Maybe he could have got me a better deal than a comparison site for my buildings and contents, maybe he couldn't, but there wasn't any pressure.

I don't have life insurance as I know it would be expensive due to my health issues. Instead I ensure any company I work for has a death in service benefit and I also join the pension schemes. On top of that I overpay the mortgage, save and pay into a SIPP.

What you've quoted doesn't read like a hard sell, just an explanation of what the broker can potentially obtain for you.

dunstonh

I am in the process of buying my first property. I used a mortgage broker and now this person  is trying to help us with Home Insurance and Life Insurance which we never had before so I am guessing they are also an insurance broker. 

Most mortgage advisers are also authorised to do general insurance (household) and protection policies (Life, CIC and PHI - income protection).   However,  they may be tied to a single insurer or panel and not whole of market.  So, you should always check first. They are meant to tell you but I know that this doesn't always happen.  Or they use the fact they are whole of market on mortgages to pretend they are whole of market on protection when they are not.

All I will said is products direct with insurers are very different to via a broker. 

Too simplistic a comment.  Sometimes the case but sometimes not.  A lot of direct insurers do actually charge more than an adviser.  However, some advisers charge more than direct.   

Sometimes the products arranged via one distribution channel are different to the ones arranged on a different distribution channel.  Usually, the whole of market/IFA distribution is the more advanced offering.    Whereas the restricted tied agent offering is often either cut down in features/coverage or increased in price.       The comparison site offering tends to focus for the budget market and sometimes they use the whole of market version but sometimes they use a cut down version to ensure they can come out cheaper on comparison sites.

For example a lot of them cover less conditions for critical illness on their none broker products, and give you access to counseling, second medical opinions etc which are free but they don't include on their products online. Also if you're wanting to protect your income it's and advised only product which means you can't do it online it has to be done with a broker

When talking about CIC, there are budget plans, middle of the road and comprehensive plans.  So, if you go into it price-focused, you will end up with a lower quality product. 

One insurer told me a while back that they increase their gross price on the product offering via the comparison site because of the amount of mistakes people buying via that method make compared to the IFA market where the quality of submissions is higher (so less work for the insruer and less issues when you come to make a claim).   However, an IFA or whole of market protection adviser would likely to be fee based or have their commission factored into the price whereas a comparison site will have a lower commission cut.

so  when it comes to home / life insurance is it indeed better to use an insurance broker? 

I don't do mortgages personally but I employ mortgage advisers and generally, they tell the people to buy their household insurance online but arrange their PHI and life assurance with them.

Sandtree

Home insurance is a fairly complex product and whilst you can buy on comparison sites you are generally then looking at price rather than quality. If you just want to tick the legal box of having buildings insurance to satisfy your mortgage lenders requirements then certain comparison sites are the way to go.

If you want more robust policies then that doesnt rule out comparison sites but means a lot more time is needed to find out if inner limits are sufficient, if they have features you want like matching set cover etc. A broker can help however there is a vast amount of decent policies out there that are direct only and so using a broker in isolation will never be comparing all your options.

Life and CI, and more importantly in my book PHI, are heavily sold via brokers and many dont offer direct sales. Here you are best going with a whole of market broker or IFA (personally had better experience with the former) as these tend to have better prices than tied agents plus can really access almost the whole market. It becomes even more important if you have any medical conditions, family history of issues etc as they have routes in to speak to underwriters before submitting the formal application. Non-advisory or online options just blindly submit with your hypertension or MS etc and get a rejection that then makes it an up hill struggle.