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Tom Baigrie: Ask not what protection can do for you

This time last year we were warming up to the challange of auto-enrolment but with consultancy charging gone and a pension charge cap likely early next year, advising on workplace pensions is getting harder.

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Is it ever a professional’s job to compensate for the failings of the state? Can an industry accept responsibility for a social ill occurring in its space when it can’t resolve it profitably in the short term?

I think today that the answer to both questions has to be a resounding ‘yes’. Business leadership needs to be about more than increasing shareholder value in the short term.  In fact, in order to protect shareholder value in the long term an enterprise has to be able to prove its worth to society, so that the very concept of the ethical profit motive retains creditability.

The siren call of not-for-profit ownership and utopian fairness for all grows ever louder as the evils of its past failures across the world recede in the collective memory.

This column has a self-selected brief to try to fix only a small part of that world, that of financial protection insurance, to give it it’s proper British title. FPI is at a crossroads in terms of its social relevance and needs to spend capital now if it is to remain able to do the job society needs it to. Rather than accept the majority of Britons seeing it as irrelevant to their lives, the industry needs to challenge this perception as in truth they are mad to live without it.

For my money the biggest scandal in financial services is that very few people have proper provision for a clear and present risk: their own long term disability.

It is a collective shame that has become far more relevant as state disability benefits have shrunk. You do not hear about it on the BBC because it approaches all issues from a battle-scarred position of suspicion at our wider industry and with an implicit desire that these things be fixed without involving the profit motive. So though it might detail the state’s withdrawal it cannot bring itself to explain that the right solution for its audience is to engage with the market and buy income protection.

So if the big influencers will not raise and debate the issue, should we? And if we do start campaigning, can we genuinely go beyond the base motive of wanting to sell more stuff, to where we are genuinely trying to fix a social ill?

It is tricky for me because, to put it crudely, selling this stuff is exactly what makes me money but in the less conflicted world of expert financial services consultancy others have more credibility!

A while ago I suggested we do this through commercial advertising but a genuine social campaign to explain to people the need to protect themselves against disability, and what life looks like if they do and if they don’t, is far more applicable to the current zeitgeist.

It still costs, of course, but if it is genuinely framed in educative rather than sales terms it will be far more effective.

Peter le Beau has long been the leader of the protection arm of the consultancy tribe and his plan to work with relevant charities to highlight the effects on the newly disabled of having an income as they would have from income protection, has the look of a powerful communications method that could reverse our slide from relevance.

The Family Support Initiative was recently outlined on these pages and it deserves our moral and financial backing because it addresses a genuine and growing social ill, and one which the state will not ever again be able to afford to fix, and we can. We need to step up and take on the challenge. Now.

Tom Baigrie is chief executive of Lifesearch

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