I was asked by an accountant the other day, why should her clients use a financial adviser to acquire their personal/business/family insurances over direct insurers, i.e. those advertised on tv, coles, woolworths and over the phone etc.
Here are some reasons why you should strongly consider the use of professional and guided advice;
- Against wide-spread belief it is NOT more expensive going through a financial adviser that can act as a broker. To be fair there may always be cheaper if that’s purely what you are looking for both via the direct channel and via a broker. Just remember that personal and family protection plans are one of the biggest investments you stand to make.
- Insurance is a business! Think about the problems associated with direct from an underwriting perspective (risk assessment); under insurances issues, unnecessary claims due to no or little underwriting requirements, extra risk brought on board due to lack of underwriting (automatic acceptance). What affect do you think this has on premiums as opposed to professionally trained brokers who choose the right policy for their customers where no unnecessary risk is entailed?
- A financial adviser has a best interest duty to the client and is not obligated to any insurance company but is committed to find their client a suitable policy for their individual circumstances at the best price. Most direct insurance companies will only sell their own products and generally cannot give guided or tailored advice, you are reassured that when you work with a financial adviser they have knowledge and experience and can advise you personally.
- Having the wrong amount of insurance does not solve the objective of why you insured in the first place, it may not meet your intrinsic need come claim time (the most important time!)
- Financial advisers generally have established relationships with underwriter and representatives with the Life Offices and can save you a lot of time especially when it comes to mid-term changes, you won’t be dealing with call centres.
- Financial advisers are far more efficient at cross checking policies than consumers, can educate their clients and can explain critical elements of a policy. Peace of mind is a huge added benefit. Direct processes tend to put too much focus on the consumer to do their homework himself/herself, this may be good for low risk policies but how about those non-standard requirements that appear more often than you would think?
- Think about claim time, will you have an advocate? Someone who understands your entitlements and can navigate the bureaucracy and negotiate on your behalf to ensure claims are handled sensitively and quick.
Give us a call on (07) 3040 4840, save yourself time, money and heartache – protect those that are important to you!
The advice on this site may not be suitable to you because it contains general information that has not been tailored to your personal circumstances. Please seek personal financial advice prior to acting on this information. Please also refer to our general advice warning under contact us tab on our website. The article is based on information available at the time of writing only and therefore care should be taken as to the accuracy of the content.
Image courtesy of [graur razvan ionut] at FreeDigitalPhotos.net