I would like to believe that my clients trust me, particularly the ones who use my services multiple times. But trust is not something easily earned. In my experience I have met with people whom are reluctant to change their existing policy even if it will actually save them money. At times I get the impression some people are dubious of a financial broker’s recommendation for one reason or another.
Lose Out Benefits
The main feedback/reasons I get for not proceeding with a recommendation are that people are concerned that they might lose out on benefits if they change. “What will happen if I die one week after taking out a new life assurance policy?” is a question I regularly get asked. Once you have been accepted by a life company, paid the first premium and the policy has started, you are covered. In essence, if you die the first day of the policy you are covered.
In many cases, people are happy with the advice and just don’t get around to proceeding with it. If people follow up with me (sometimes months after initially showing an interest), the usual response is that “I was really busy and I completely forgot”. After all, who wants to spend time contemplating how much life cover or serious Illness cover their family might need ?
“How do I know that you won’t just choose the policy that pays you the most commission?”. I was asked this once, but would imagine it’s a question that some people ponder in relation to brokers. If you are unsure I recommend that you ask questions. A letter of suitability sets out why a broker would choose a specified company/product over another. You could also ask what the broker is being paid to place business in a certain place.
A lot of events have happened in the financial services sector which have left many people with an understandably fragile confidence in the industry. It is clear that some people feel that brokers are guilty by association, which is understandable.
If you have never used a financial broker or have been disappointed with an experience using one and are reluctant to consider it, you have a number of choices. You could do your own research, but potentially lose out on cost saving opportunities only available to brokers. You could ask a friend/relative if they have a trusted adviser you can contact. You can do a bit of both and contact a broker yourself and do your own research (if you are a bit dubious).
You may very well have the most cost effective and appropriate Life Assurance or Pension policy to suit your needs. However if there is a chance that this is not the case, do you think it’s worth exploring alternatives?