And finally, having looked at their future financial position, are there any concerns about an inheritance tax liability? Are they able to utilise any of the main IHT exemptions available to them? And if the liability for a tax bill upon death cannot be reduced, might a protection policy such as a whole-of-life plan allow the clients to mitigate an overall IHT liability upon death.
Underpinning your advice with protection
How does protection help to underpin the quality of your advice and your clients' plans for the future? Something I often discuss with advisers is how protection fits in with four key areas of focus for many businesses:
- Risk – by ensuring we have had a protection conversation with our clients or referred them to a protection specialist we are putting them in an informed position in relation to the risks they face. We are giving them a chance to say no, but we are also giving them a chance to say yes.
- Reputation – nobody wants to receive that dreaded phone call in the future from a client who has been diagnosed with a critical illness or is dealing with the death of a loved one, or maybe finds themselves unable to work, only to find out there was no protection conversation had.
- Retention – by creating bespoke protection solutions that are flexible to your client’s changing lifestyle, your advice becomes harder to copy.
- Revenue – financial protection gives you another revenue stream. Multi-benefit protection solutions can allow you to create a mix-and-match bespoke solution for clients.
Above all, we have a duty of care to our clients. If you are not going to talk about financial protection, consider referring clients to a protection specialist so the conversation still takes place. We should not be doing nothing.
Gregor Sked is intermediary development and technical manager at Royal London
