Adviser insights on making income protection conversations count
As this year’s Income Protection Action Week arrives, Vitality Adviser Editor Rob Harvey caught up with two leading advisers to discuss how they approach IP conversations with their clients and the product features that most resonate
Few would disagree that protecting a client’s income should be at the cornerstone of comprehensive financial planning, after all, someone’s income is usually what funds everything else in their life, from mortgage or rent payments, monthly bills to pension savings.
And at a time when many household finances are still precarious and we see record numbers of people dropping out of work due to long-term sickness[1], income protection (IP) has arguably never been more important.
Overcoming optimism bias and tighter budgets
A common challenge advisers face though is peoples’ optimism bias and a belief that ‘it won’t happen to me’. This, coupled with tighter budgets due to the ongoing cost-of-living crisis can make IP a harder sell.
For Alan Palmer, Senior Vice President at Genistar, it’s all about educating clients on the value of IP and the reality of not having it. He points out that “Statutory Sick Pay (SSP) in the UK is just £118.75 per week, rarely enough to cover regular bills” and adds that, “it’s essential to show what could be lost without protection - home, living standards, financial stability”.
Sam Norfolk, a mortgage adviser at Chamelo, highlights that “self-employed clients wouldn’t get sick pay at all or be eligible for SSP”, heightening the need for IP.
Recognising that cost will be an issue for many at this time, Sam adds that “tailoring something that works for them and is affordable has to be the priority”. He points to Vitality’s unique Optimiser as one way of keeping the premiums down, “as it will offer the client the best available premium upfront, which they can maintain if they engage with the plan”.
Alan concurs, saying that “IP can be tailored to most budgets, closing the gap so that families can return security and peace of mind – even if life takes an unexpected turn”.
Building a package of protection
For both advisers, IP shouldn’t be thought of as a standalone product either, it’s part of a wider protection package. Sam highlights the importance of understanding clients’ sick pay structures, especially as a mortgage broker. “When you ask clients what happens when their sick pay ends, that’s usually when they realise it’s important to have cover in place,” Sam notes.
Alan recommends incorporating IP into a menu plan, allowing clients to combine Income Protection with Life Cover and Serious Illness Cover under one flexible plan. “Clients can tailor each element to match their needs and budget, gaining multi-benefit discounts and one consolidated premium for all covers,” he explains.
“Protection shouldn’t just be a tick box exercise, especially in light of Consumer Duty and the need to deliver good client outcomes and avoid foreseeable harm”, adds Alan.
Providing more relevant cover for changing client needs
At the same time, we need to recognise that client needs have shifted in recent years, especially in the aftermath of the pandemic and that IP products need to keep up.
It’s not uncommon now for people to change jobs or career multiple times, highlighting the important of features like IP benefit guarantees, which allow clients to fix their monthly benefit and protect them if their earnings change.
Sam highlights the fact Vitality allows clients to verify their earnings upfront and fix their benefit, which can be “reassuring for clients to know that their benefit amount is guaranteed”.
With the higher inflationary environment we’re living in, including indexation – ensuring the benefit rises each year in line with inflation – is also “critical” says Sam.
Flexibility of cover is also key and whether that’s the ability to increase the monthly benefit or finishing age of the plan, or reduce the deferred period at certain life events, Guaranteed Insurability Options can be especially useful.
Alan also points out the importance of offering “flexible and affordable payment periods such as one, two or five year options, alongside the more comprehensive full term (up to retirement age), ensuring cover aligns with individual circumstances and employer sick pay arrangements”.
More than just a financial safety net
As well as ensuring clients have a comprehensive financial safety net to protect them should the worst happen, IP plans are increasingly also able to provide wider health and wellbeing support.
Both Alan and Sam point out Vitality’s unique Income Boost and Recovery Benefit, the latter providing clients with access to rehabilitation support immediately from the point of claim for cancer, mental health, musculoskeletal and neurological conditions.
“The recovery pathways are also a massive part of the process…knowing that there is additional support on hand can make a big difference”, says Sam. Alan adds that it proves “real peace of mind to my clients”.
The Income Boost meanwhile pays clients up to 20% extra on top of their monthly benefit, for the first six months of their claim, based on their pre-claim Vitality status. This is about rewarding clients for looking after their health and therefore the likelihood of a faster recovery if they do fall ill and Sam says “can be a massive encouragement for people to life a healthier lifestyle”.
Alongside all of the benefits of the wider Vitality Programme, which clients can access from day one of their plan and well before a claim is made, this emphasis on health and wellbeing can make conversations more “client friendly” in Alans view.
He says that “this combination of protection, rehabilitation support, and motivation to stay healthy creates a compelling case for clients to understand the value of IP beyond just premiums and claim payouts”. This in turn “encourages clients to actively engage with their policies—not just at purchase, but throughout the life of the cover”, and that higher engagement “drives high policy persistency, meaning clients keep their protection in place over time, securing their financial future”.
Ultimately, both Alan and Sam agree that recommending Vitality IP to their clients doesn’t just deliver better protection outcomes, it also adds significant value to their overall business.
“The future is uncertain and nobody knows what may happen to them. Having a comprehensive protection plan in place can offer that peace of mind that we all want”, concludes Sam.
Personal Protection from Vitality
As well as offering the highest levels of protection, we also make it easier for your client's to take an active role in maintaining their wellbeing. We help them to understand their health and reward them for healthy lifestyle choices, by keeping their premiums low and giving them access to a range of discounts and rewards.
Recent articles
Five things you need to know about the Vitality Programme launch
Hot on the heels of the latest Vitality Programme launch, Justin Garbutt, Director of IFA Distribution, shares his key takeaways for advisers
Four simple steps to comprehensive mortgage protection advice
With homeowners continuing to feel the pinch against a challenging economic backdrop, Justin Garbutt, Director of IFA Distribution at Vitality, gives his tips to offering the most comprehensive mortgage advice possible
Dr Rishi Patel: ‘A joined-up approach to cancer screening is the answer’
Vitality’s Clinical Operations Director explains the critical role that cancer screening can play in early detection and improved treatment outcomes, and why joined-up care pathways are key
.png?rev=eaec4e31e03740b584885562b84b459f&h=581&w=600&la=en&hash=A8F2E4F7537010226B7DA4C9EDE9A8FA "Headshot Rishi Patel")
Life resource library
Our user-friendly library makes it easy for you find the literature and tools you need to support your life insurance client conversations.
- Search for documents by keyword or topic
- Discover helpful resources and tools including our Most Popular
- Explore categories and further refine using the Document Type filter