There is nothing more frustrating for protection specialist Paul Litster than coming across clients who are thinkers rather than doers. The managing director of advice firm Specialists4Protection, which launched last year, admits to being “blunt” with clients who take on board the importance of protection and their need for it but then procrastinate.
He says: “They say things like ‘We need to think about that’ or ‘I need to discuss that with my wife’. But the underwriting itself can take a month. I tell them: ‘How about we get the ball rolling now? You can tell your partner this is what you’ve put in place so if something happens, they’re looked after’.
“Some men’s response is that if something was to happen to them, their wife will just marry someone else. You think they’re joking, but they’re not.”
Litster is jovial on the whole when reflecting on his experience in the protection industry. But there are moments when the harsh realities of life underline just how serious it can be if someone does not heed the protection message in time.
“Two months ago, a chap said he wanted to meet me on a Monday but he had a heart attack over the previous weekend. His daughter had to cancel our meeting before he’d got cover. We all think it is not going to happen to us.”
Litster points out the traditional touch points people used to have for protection have disappeared. Banks have moved away from advice and getting on the housing ladder later – if at all – means tough conversations about life’s unpleasant “what ifs” are not happening.
Even if people do manage to buy a property, Litster acknowledges some mortgage advisers feel they do not have the time to get involved in protection. It used to be so different, he says. “I remember buying my first property. I sat down with an adviser who told me what the mortgage would cost and what I would need to run protection alongside it.”
Litster started his career as an engineer and wanted to get into the sales side of the industry. But potential employers were reluctant to give him a chance because he lacked actual sales experience. The obvious solution was to get that elsewhere.
“I saw that insurers were looking for people to go into sales so I thought I would do that for a year and go back to the companies I had been talking to about engineering.”
However, he found financial services so enjoyable he never did go back. “It is a fabulous industry. People complain there has been so much change. I suppose a lot of people don’t like change but if you don’t it’s the wrong industry to be in.”
Litster spent the early years of his financial services career in tied sales with Eagle Star and Royal Insurance. At Eagle Star (which eventually became part of Zurich) he was selling pension and investment products, but mainly protection on the back of existing general insurance sales.
At Royal Insurance he ran his own branch that dealt mainly with protection and it was a natural progression for him to become an IFA.
“I always knew in my heart of hearts that if I was in competition with an IFA, it would have to be a bad one. After all, I had what I had and they could offer the whole world. How powerful is that?”
A move into IFA distribution followed, with roles at Zurich Financial Services, then Prudential Intermediaries. However, Litster says, surprisingly, having been an IFA himself did not help.
Some men say if anything happens to them, their wife will just remarry. You think they’re joking but they’re not
“I thought I was going to have discussions with my peers but I wasn’t making the decisions anymore. I was almost back to being tied again. It took me about 18 months to get my head around it and in meetings with advisers I’d rarely mention I’d been an IFA.
“When I finally got my head around it I became the top salesperson at Zurich. As an IFA you flit between pensions, investments and so on, and it’s difficult to keep a high level of experience in all of them. But I was bringing them ideas and making a difference.”
Litster saw a lot of advisers were frightened to go into business protection and were missing opportunities. Before long, he was thinking “I could do that myself”. Fast forward to the launch of Specialists4Protection and Litster is finally making the most of the opportunities he spotted among SMEs.
“A lot of the businesses we deal with have one to five people; a lot are one or two-man bands and we pick up individual business as well.”
For Litster, investment and pension advisers are doing fantastic jobs in creating retirement plans for their clients. But without adequate protection, the advice they give to clients is falling short. “What if the client can’t work? What is plan B? Do you just accept that you will have less in retirement, or realise that you can do something about it?”
He also feels younger advisers at some firms can be hindered by older advisers who do not operate in the protection market.
“There are older firms that have new blood coming through and these young advisers understand protection. They are champing at the bit to get to the client bank but a lot of older ones will not let them get anywhere near. It’s a shame as good up-and-coming advisers have had to leave these firms because they are not getting a chance.”
What is the best bit of advice you’ve received in your career?
Don’t be afraid to make mistakes.
What keeps you awake at night?
Working with clients who understand what I’ve said about protection but then procrastinate. Let’s get on with it!
What has had the most significant impact on financial advice in the last year?
Brexit. We deal with a lot of IT contractors who don’t know if their companies will pull out of the UK or if their contracts will be renewed.
If I was in charge of the FCA for a day I would…
Have less red tape and make it easier for people to access advisers.
Any advice for new advisers?
It’s a fabulous industry. You can make a real difference to people’s lives, and it changes constantly so you’ll never get bored.
2016-present: Managing director, Specialists4Protection
2013-2016: Business consultant, Vitality Health/Life
2010-2012: Regional account manager, Prudential Intermediaries
1998-2010: National accounts manager, Zurich Financial Services
1996-1998: IFA, Barnsley Building Society
1994-1996: Financial consultant – tied sales, Royal insurance
1991-1994: Financial consultant- tied sales, Eagle Star