Despite the uncertainty hanging over the future of Equitable Life, it is business as usual for protection specialist subsidiary Permanent Insurance.
The company is eager to let IFAs know it is not affected by the dispute surrounding its parent company.
Permanent says whatever company ends up with Equitable Life will also be the new owner of a rapidly growing protection business.
To a large extent, how IFAs perceive Permanent is due to sales and marketing manager Rod Macdonald.
When Macdonald is asked what the future holds for Permanent, he is quick to insist that the Equitable sale is nota negative move. In fact, it is simply a non-issue for him. He says he is so busy preparingto expand and upgrade Permanent's product range that he has not had time to worry about having a new owner.
Macdonald says: “I hope the new owner will look at Permanent as a protection specialist and decide what course of action to take at that time. It is a complete unknown for us as there are 12 companies in the bidding for Equitable.”
Permanent is involved in the entire range of protection products from critical-illness plans to individual and group income protection and long-term care insurance.
There are plans to upgrade its group income protection product next year and to expand its LTC range to take advantage of the stability provided by the Government's recent response to the royal commission on private med-ical insurance.
The Government says it will cover the first £18,000 of LTC costs. It increased the means test from £8,000 where a person must spend their own money before getting Government help.
Macdonald says this is the best that could have been hoped for from the Government. He says it sets out the rules of the game clearly and allows providers such as Permanent to design products accordingly.
He predicts LTC is the area of protection that has potential for significant growth because of the Government's move. The sector has been stagnant for several years but Macdonald sees it growing.
Permanent sells exclusively through IFAs and Macdonald has very strong views on the polarisation debate. He wants the status quo to be maintained, saying that any significant change will hurt customers' interests.
He says: “I am very hope-ful that polarisation will rem-ain. Although it has been tarnished, IFAs meet people's needs and are essential for financial services in the UK.”
Exeter-based Permanent has 250 employees. It has £300m in assets and is look-ing to double in size in the next five years although it would like to do this in the next three years.
The company has ambitions to be one of the top three protection providers in the UK. Macdonald estimates it currently stands in the top 10 and possibly in the top six. Many of its competitors are part of bigger life offices such as Swiss Life, CGNU and Zurich Financial Services. Others in the specialist market include Unum and Pegasus.
However, competitors say Permanent is not seen as a major player by themselves or IFAs. Scottish Provident product marketing manager Roger Edwards says: “Perm-anent is not really a comp-any that comes up that often when I am talking to IFAs about protection.”
Macdonald has been with Permanent since the start of last year. Before that, he spent 20 years with Phoenix, which is now part of Royal & Sun Alliance. In his time at Phoenix, he held a variety of sales and marketing positions dealing with protection issues.
Following the Royal & Sun Alliance merger in 1996, he was part of a team developing investment business for the life office. Macdonald says he then became disenchanted with the company.
He says: “It is a merger that has never worked. I did not like the culture that was developing there so I made the choice to move on.”
He says the atmosphere at Permanent is very different. Because the company is relatively small, Macdonald says it can move quickly on new ideas, unlike bigger companies which can get bogged down in bureaucracy.
Permanent has an aggressive attitude to the internet. It has designed an IFA site which offers a plug-in service to enable advisers to provide quotes to clients efficiently and it has a consumer website with details of its products.
The company recentlylaunched two advertisingcampaigns to raise its profile and Macdonald estimates they have resulted in a 20-fold increase in business.
The consumer ads are geared towards the younger generation, highlighting the need for critical-illness cover.
However, Edwards admits Permanent has been more at the forefront recently, launching a number of new products over last 12 months.