Despite the government targeting MPPI sales of around 55 per cent, it is estimated only 25 per cent of new mortgages are currently covered by the insurance and this has worried many within the industry.
In last week’s Mortgage Introducer, Infinity Mortgages’ Simon Biddle called for MPPI to be made compulsory and while Select & Protect does not believe in mandatory MPPI sales, it wants to make people conscious of its importance.
Bruce Reid, managing director at Select & Protect, said: “What we want to do is help spread the message to all consumers that MPPI products are available offering a valuable multi-dimensional mortgage support package, at an affordable price. We also want to combat the negative perception that payment protection insurance is receiving and its wrongful association with MPPI.”
Much of the apathy towards MPPI is attributed to clients not wanting an additional cost within their mortgage and scepticism regarding the level of cover they will receive.
Jason Richardson, director of YooToo Financial Services, agreed the problem is clients’ perception that they don’t need insurance.
“It becomes easier to sell insurance once people realise it’s got redundancy cover rather than just health cover. The problem when it comes to selling insurance is not about a lack of time with clients but peoples’ perceptions. The client is willing to pay £1,000 a month on mortgage payments but they are very unwilling to add another £20 onto that for insurance. Personally, I don’t understand it but I guess in general, if people don’t have to spend money then they won’t do and insurance is one of the first things to go.”
