A key provider of loan protection insurance claims customers are coming to expect that brokers will raise the issue of insurance at the time of their loan application.
Loan protection insurnace provider ALI Group has seen a 32% year-on-year increase in insurance sales through mortgage brokers authorised to offer its general advice insurance products, as at 30 September.
ALI's CEO, Ray Hair, said findings in the most recent Commonwealth Bank/MFAA Home Finance Index reflect increased customer awareness of the need for insurance, and expectations that a broker will raise the importance of insurance during the loan process.
Yesterday, the MFAA released its findings which showed over a third of broker customers would take loan protection insurance if it was offered by a broker, but only half had been offered the product.
"ALI Group has always believed mortgage brokers are uniquely placed to offer loan protection and/or life insurance to borrowers at the time of their loan application," Hair said.
"It is a logical extension of a mortgage broker’s duty of care and helps to satisfy their NCCP responsible lending obligations which require better knowledge and understanding of their customers’ financial positions."
Hair said raising the issue of insurance can be done in a number of ways, but that often, the offer of loan protection insurance as part of the loan application process is the most effective.