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Warning that providers could turn backs on IP

Insurance providers will turn their back on income protection if advisers fail to improve their understanding of the product, warns Direct Life and Pensions key account man-ager Phil Jeynes.

Jeynes says that with an increasing lack of understanding about IP, providers will start questioning the need for producing documents for each sale.

He says: “I would not be surprised if providers made the decisions not to support the product in future, given the poor sales figures. Most had expected an increase in sales as PPI sales dropped but this has not happened. It is either sell it or lose it.”

Lifesearch policy adviser Matt Morris says a mass exit from the market would be very damaging for the protection industry but providers have a part to play too. Morris says: “Certainly, IP is not quick or easy to sell compared to life cover and advisers do have to make an effort. At the same time, providers can help by making an advertising splash about IP to alert consumers to the product.”

Morris says more providers should look to Forits’s Real Life Cover product for influence.

CBK Colchester principle Peter Chadborn says he does not believe it likely that providers will turn their backs on IP.

He says: “This highlights the problem with the industry that a lot of companies who manufacture and distribute the products do not understand enough about those who are selling it for them.”

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