Burgesses’ managing director Simon Burgess says: ‘We all know that lenders are increasingly desperate to sell insurance to our clients by the calls and the direct mail they receive. One could assume that this is to save us the trouble. However, the real reason is that it is highly profitable for them with individual commissions running into hundreds, if not thousands of pounds."
Burgess continues: ‘Furthermore, it is not only the extortionate, rip-off prices that lenders are guilty of but the quality of the cover they are selling is often grossly inferior. For example, lenders’ PPI tends not to pay out until after a 60 day excess period whereas those sold through specialist brokers usually offer back-to-day-one cover. Lenders also normally prevent people with pre-existing medical conditions from switching without further medical underwriting, whereas those who buy via the specialist market can avoid this problem with fully portable policies',
Until now it has been difficult for brokers and IFA’s to offer a better deal for their clients and offer PPI that provides true value for money. This has now changed with the launch this week by Burgesses
The BIBA/Burgesses online ASU facility enables brokers and IFA’s to have a link to all or any of the BIBA/Burgesses product portfolio. This ensures maximum policy conversion, in a simple, straightforward manner, without cost or formality. Furthermore, all applications are fully tracked, with hard coded numbers to ensure that there is no slippage in commission (which is currently paid at a rate of 20% of net premium).
Graeme Trudgill, Technical Service manager at BIBA says, "It is not uncommon for mortgage lenders to take in excess of 80% of a client’s premium in commission. This is an excessive amount of remuneration and is unrealistic in today’s terms, it makes the product more expensive for clients and does not represent value for money, it is pure greed. The Burgesses product available from BIBA members is a far cheaper and far fairer choice for a client’s protection"
The BIBA/Burgesses facility is completely free of charge to FSA authorised firms and will enable brokers and IFA’s to claim their rightful share of ASU commission, instead of allowing the lenders to profiteer from their clients.
