View more on these topics

Do LGBT clients need specialist protection advisers?

The protection market needs to have wide appeal if it is to stand any chance of increasing take-up of its products. To have that appeal, people need to feel it is relevant and meets their needs.

So does this mean we need more specialist products for niche areas of the market, rather than generalist products designed for mass appeal? Could specialist products improve inclusivity or could it be counterproductive in reinforcing negative stereotypes of difference?

The case for specialist products 

Research from Emerald Life, a firm that launched last year with a range of insurance products aimed at the lesbian, gay, bisexual and transgender community, suggests many of these consumers are disengaged from the insurance and financial advice sectors.

Until 2005, insurance companies were allowed to ask questions about sexuality and lifestyle, while gay men applying for life insurance were automatically sent for HIV tests. The industry has clearly come a long way since then but the negative impact on this community remains.

Personal Finance Society chief executive Keith Richards believes products tailored to individual needs and circumstances will enable specialist providers to engage consumers who would not otherwise consider financial advice or insurance products.

He says: “The LGBT market is a niche market but there is huge potential for specialist firms and services. They will play a big role in bridging the current protection and advice gap,” he says.

Emerald Life, which offers LGBT consumers products such as term life cover up to 10 years, says the insurance world is not generally tailored towards the community and families who do not conform to the nuclear family unit. It says this leads to a lack of trust and engagement, which ultimately means LGBT consumers are under-insured relative to the wider population.

It found 80 per cent of LGBT people it surveyed felt the insurance industry did not understand their problems and issues. Chairman Steve Wardlaw says: “There were three big issues. They didn’t see themselves in the imagery and marketing; they have to answer ill thought out questions in call centres and they didn’t feel the policies were designed for them.”

Emerald Life chief executive Heidi McCormack says they have found discriminatory clauses in insurance policies (for example, home and contents cover that excluded the fashion and entertainment industries, which insurers used to associate with gay men) although she believes much of this is hangover wording from the past rather than deliberate.

Specialist advice, not specialist products?

But protection advisers do not think specialist products add value. Future Proof chief executive David Mead says: “We do not see the need for specifically designed products for the LGBT community. We believe it could inadvertently be counterproductive by highlighting that somehow the community is different and should be treated differently.”

Specialist LGBT IFA Compass Independent founder and practice manager at Unusual Risks Mortgage & Insurance Services, Chris Morgan, campaigned for decades to remove “the stigma and hard-line discrimination” the LGBT community faced from the insurance industry.

He says: “It’s been a long process that I’ve been at the forefront of. Insurers don’t discriminate against gay people now. They used to but that ended in 2005.”

Morgan has seen a fair number of providers with specialist products for the LGBT community come and go over the years. “They don’t last because the products they offer don’t generate the volume they need quickly enough to enable them to survive,” he says. “In the past these have generally been pension and investment products which haven’t taken off.”

White-labelling products as LGBT “because they have a few bells and whistles designed to appeal to gay people” does not make them more suitable than anything else in the wider market, says Morgan.

He says: “According to the last survey in 2016 by Compass, 76 per cent of life policies taken out by LGBT people were intended to cover a mortgage, normally 25 years – and 24 per cent were taken out to cover families over the long-term. If a 10-year term was the only option in the market it would be something the adviser would have to recommend but there are scores of policy options with a maximum term of 40 or 50 years.”

Instead of specialist products, Morgan thinks LGBT customers are better served by specialist advisers. “They will have access to the whole market and to the very best products available to meet their needs,” he says. business development director Mike Preston is also not convinced LGBT clients need specialist products, particularly in the advised market. But he does see a role for organisations like Pride to facilitate online quotes and applications for LGBT consumers who do not seek advice.

He says: “If the affiliate site has the capability to produce quotations online and complete online, LGBT people could buy into that service and that could help.”


Providers need to pay out to boost interest in protection

The claim is our core product in protection; not the policy. In a digitally enabled world, where all power is flowing rightly to the consumer, we should be making the sharp end of what we do – the end that matters most – utterly brilliant. We have recently seen US disrupter business Lemonade lead very […]

‘Give young advisers a chance to bridge the protection gap’

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: […]


Protection brief: Adding value through legal advice

One area grabbing the protection industry’s attention at the moment is the provision of legal advice for those diagnosed with a serious or terminal illness. Some providers already offer basic legal advice more generally through telephone helplines as part of their “value-added” support packages. The idea is to provide practical help rather than just throw money […]

What are the key changes to transform pensions?

By Fiona Tait, pensions specialist In her final article for Royal London, Fiona Tait reviews key changes she believes have transformed, or will transform, pensions. In my 12 years with Royal London I have been paid to review, study and explain the numerous changes to pension legislation which have transformed our industry in that time. This is […]


News and expert analysis straight to your inbox

Sign up


There are 2 comments at the moment, we would love to hear your opinion too.

  1. Ridiculous! If I was a cynical person I might believe that a heavily slanted survey was undertaken to help with a questionable marketing campaign. Who next – people who are left-handed, who think Russell Brand is still funny or who read inane MM blogs?!

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm