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Our campaign to protect consumers gathers force

Which? and Aifa are throwing their support behind Money Marketing’s No Advice, No Protection campaign, asking for consumers to be better informed when buying protection on an execution-only basis.

Both bodies believe a simple table of bullet points is needed to outline the fact that execution-only consumers relinquish some protection from the Financial Ombudsman Service. But they stress that any form of presales literature should be succinct.

Aifa deputy director general Fay Goddard warns of information overload but supports a table of bullet points with a tick box to show the consumer understands they are entering an unadvised and unprotected environment.

Which? says it has been expressing concerns on protection sales since general insurance regulation was introduced. Principal researcher Teresa Fritz says complex insurance such as income protection, critical illness and life cover should not have been included with simpler products such as car and house insurance.

She says: “The onus has been placed on consumers to make the right choice, so it is essential that consumers ask themselves whether they are being offered a wide enough range of products and whether they need more information or advice.

“We wholeheartedly support the campaign as we regard the purchase of protection through direct sources in its current form to have the potential for a lot of consumer detriment.”

Goddard says: “No Advice, No Protection is a key message. We are very supportive of the idea and consider advice absolutely crucial in adding value.”

Highclere Financial Services partner Alan Lakey says: “There are complex issues with regards to the purchase of protection products. What it really comes down to is that customers should be taking advice from someone who is whole of market.”

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