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Education needed for impaired market

Adviser education and greater product flexibility is key to making insurance more accessible to impaired lives.

The Insurance Surgery, which has been set up specifically to help clients with pre-existing medical conditions, says the impaired lives’ market is an area of great opportunity. But sales and marketing manager Dan Sharpe claims that few advisers operating in this sector are giving the correct advice.

Sharpe says: “There is a huge market for impaired-health cases and we feel these clients are not being dealt with properly because you cannot unless you have that level of knowledge. There must be many thousands of people out there with the wrong cover or paying twice as much for cover because they assume that is all they can get. But nine times out of 10, this is not going to be the case, it is just that the IFA has found the cheapest price.”

Master Adviser IFA Roy McLoughlin says impaired insurance is an area where people need more education, especially on medical guidance. He says: “I think advisers need some hand-holding on what can be a very emotive subject.”

Munich Re chief underwriter Paul Gyseman says there is scope to raise the bar on the loading cap. Traditionally, the cap is around 400, although some insurers accept higher ratings. He says: “Anecdotally, there are a number of impaired lives that are insurable if written right. That bar can be raised. Increase the cap on the rating system and start thinking about going up to 800/1,000 mortality.”

Highclere Financial Services partner Alan Lakey says he would like the option for higher loadings. He says: “Rather than telling me that the loading is too high to bother with, I would prefer to be able to offer my client a choice.”

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