Mortgage Rate Drops, Inflation Insights, and How Life Insurance Can Transform Your Clients’ Financial Future.

The last few weeks have been remarkably interesting as we’ve seen many mortgage lenders dropping their rates in a bid to breathe life back into the market.

The stability of the Bank of England base rate in December (where it remained at 5.25%) has given hope that we could see a drop in interest rates later this year.

Today (18 January), it was announced that inflation had risen marginally to 4% in December, up from 3.9% in November. While this highlights that any falls in inflation are never linear, it is worth noting that inflation has been falling much quicker than the Bank of England originally predicted.

Speaking to the BBC, both Ruth Gregory, deputy chief UK economist at Capital Economics and Samuel Tombs, chief UK economist at Pantheon Macroeconomics, agreed that, realistically, we could be looking at May or June 2024 for a base rate cut.

What does this mean for mortgage brokers, IFAs and wealth management teams?

The good news is that this could stimulate the mortgage market. As mortgage rates come down and energy prices fall, consumers may feel that their affordability has improved. They may be more likely to move home.

With pent-up demand for new mortgages and an avalanche of customers needing to remortgage (especially those coming to the end of a 2-year fixed deal taken out at the peak of the mortgage crisis), this could see you swamped with paperwork and stretched thin.

Life insurance is essential to complement mortgage applications

Nearly two-thirds of all new mortgages are taken out in joint names. So, it’s no surprise that lenders want to see proof of how someone would be able to keep up with their mortgage repayments if one person were to pass away or be diagnosed with a terminal illness.

Sorting out life insurance can be time-consuming, especially if you’re trying to cope with the demand for new mortgages or remortgages. As we get nearer to the predicted base rate cuts in May or June, you could find yourself overwhelmed with work and struggling to give each client the care and attention that they deserve.

Life insurance policies should always have that expert insight

We know that you know what you’re looking for when it comes to life insurance plans.

Your primary focus will be on securing decreasing life insurance policies that align with your client’s mortgage terms and lending amounts.

But while mortgage life plans are great, there may be many scenarios where a term plan or a whole life plan may be better suited to that specific client.

Suppose you’re tight on time or overloaded with paperwork. In that case, you might not have the resources or time available to speak to each client about what they want from their life insurance plan. The last thing you or your lender wants, is for the client to cancel their insurance policy several months down the line because they are not sure they are getting value for money.

Here at The Insurance Surgery, we live and breathe life insurance.

We believe that everyone deserves to feel financially protected, and sometimes, that protection is more than just knowing the mortgage will be paid off. It could be about having enough cash to leave the kids an inheritance or ensuring that any school or university fees will be taken care of.

With our help, we can guarantee that your clients will have the long-lasting protection that they need. We can also double-check that they are not over-insuring or under-insuring themselves. We can find access to the best deals and find out what’s important to each customer.

What’s more, 98% of our customers have at least one pre-existing medical condition. So, if you’re worried that you can’t find an affordable life insurance plan for your clients because of their medical history, we’re confident we can help.

Our life insurance referral scheme offers generous commissions.

We offer an exceptionally generous commission scheme for mortgage brokers, IFAs and wealth management clients. If you’re not sure you have the time or resources to find a suitable life plan for your client, let us know, and we can manage it for you.

One of the biggest frustrations amongst mortgage brokers is the amount of time it takes to complete a life insurance application. If your customers have pre-existing conditions, they may need a medical – in which case, the application can take up to 6-8 weeks to be completed. We understand that you’re likely working under significant time pressures, and you simply don’t have that amount of time to wait, particularly if your clients have a short time frame between exchange and completion.

However, with our help, we can manage the entire application on your behalf. We’ll liaise directly with your client, arrange for any medical reviews required, and speak directly with the insurance underwriters. Your time will be freed up, allowing you to concentrate on other tasks.

• We’re happy because your customer has the proper protection in place.
• Your customer is happy that their financial future has more security.
• You are happy that your customer has a suitable plan to protect their mortgage.

It’s a real win-win situation!

If you would like to refer a client to a trusted specialist broker, simply complete the IFA referral form.

To find out more about how we could help your clients and pay you a commission on customers that you cannot help, contact us today at 0800 083 2829 or contact Charlotte via [email protected]