This week’s Personal Column features: Poverty costs UK £78 billion a year | Maximise your membership | Nearly nine in 10 homeowners struggle to understand home insurance | Equity release lending hits a new record | Banks turning to voice recognition
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The effects of poverty in the UK cost the average taxpayer £1,200 a year, and the UK £78 bn in total, a report says.
The Joseph Rowntree Foundation looked at how poverty – living on incomes below 60% of the median – affected different government services.
The NHS bore the brunt of the costs, it said, as those in poverty were “more likely” to suffer ill health.
The government said employment was key to beating poverty, adding that “we’ve made good progress”.
The foundation, which funds research into social policy, said its total bill for poverty didn’t include money spent on benefits.
It said the research, conducted by Heriot-Watt and Loughborough universities, was the first to look at how much poverty across all age groups costs different government departments.
The report outlined the following key costs:
► £29 bn on treating health conditions associated with poverty.
► £10 bn on schools providing initiatives such as free school meals and pupil premium for poorer students.
► £9 bn on the police and criminal justice systems dealing with the higher incidence of crime in more deprived areas.
► £7.5 bn on children’s services and early year’s provision, such as free childcare for deprived two-year-olds.
► £4.6 bn on adult social care.
► £4 bn on housing.
The Trussell Trust, which aims to reduce poverty in the UK, said a record number of people were now using food banks, and usage had been rising since 2008.
In 2015-16 emergency three-day food supplies were handed out 1.1m times across its 424 foodbanks – a 2% rise on the previous year.
The Joseph Rowntree Foundation report said the strong relationship between poverty and ill health was now “widely accepted” – especially in cases of malnutrition and people living in cold, damp or unsanitary housing.
Ill-health in turn could lead to further difficulty when people were unable to work.
There was also growing evidence of links between poverty and mental illnesses, where the stress of living in poverty triggered “serious episodes” of ill health.
Professor Donald Hirsch of Loughborough University, co-author of the report, said it was hard to estimate the full cost of poverty, “not least its full scarring effect on those who experience it”.
And he stressed that “the very large amounts we spend on the NHS and on benefits means that making a section of the population more likely to need them is extremely costly to the Treasury”.
Julia Unwin, the foundation’s chief executive, called for “real action”, saying: “Poverty wastes people’s potential, depriving our society of the skills and talents of those who have valuable contributions to make. This drags down the productivity of our economy, hinders economic growth, and reduces tax revenue.”
The article “Poverty costs UK £78 billion a year'” is available to share with your clients!! Here’s the link for you to share on social media: http://bit.ly/0508Client-article1.
Maximise your membership
As part of your membership you have access to conveyancing expertise, market-leading technology and a panel of first-class providers. To help you maximise your membership, here’s a refresher of how you can take full advantage of what they offer.
► Additional income – earn up to £200 for sales, purchases or standard remortgages.
► Fast results – improve efficiency, get instant quotes and be able to instruct immediately.
► Choice – choose from the 200 solicitor firms bases on costs, location and service ratings
► Quoting options – a wide choice of accurate, clear and all-inclusive conveyancing quotes.
► Helpdesk – access to a UK-based helpdesk seven days a week, including Bank Holidays and a team of case-handlers to drive quick completion.
► Regular updates – get case updates e-mailed to you and access online case tracking 24/7.
► Support – training is available to help with case progression.
► Peace of mind – all solicitors are authorised and regulated by the Solicitors Regulation Authority or the Council for Licensed Conveyancers.
► Grow your business – make the most of your cross-sell and up-skill opportunities to cater for all of your customers’ needs.
► Faster and efficient solution – all built within Toolbox, saving you time.
► Visual aids – sliding scale to show premium and cover changes to boost cross-selling.
► Intelligent matrix quoting – display multiple cover for single and menu options within one quote.
► Straightforward researching – interlinked with the identification of customers’ needs.
► Real-time access – view a wide range of options to quickly react to customer’s requirements.
► Time-saving – quoted information can be stored for future reference or re-used for further customer options.
► A vast range of products – providing you with more choice and cover options for your clients and their needs.
► Quality service and support – through leading online submission systems and strong face-to-face and telephone support when you need it.
► Competitive premiums – allowing you to offer quality competitive product to your clients.
► Marketing literature – a vast range of client facing marketing tools to help grow your protection business.
► Strong commission rates – rewarding quality business by giving you access to market leading commission rates.
If you’d like to know more about either of the above, please get in touch with the member contact team on 0121 767 1002 or at email@example.com
Source: Personal Touch
The word no one wants to hear
Cancer – the word no one wants to hear… however, someone is diagnosed with cancer every two minutes in the UK making it an all too familiar event in our everyday lives.
Do your clients have the right cover in place to help them with a cancer diagnosis? Are they in position to deal with the financial and emotional disruption that a cancer diagnosis would bring to them and their families?
Their latest blog explains how AIG Life have the solution to your client’s worries with our comprehensive critical illness cover.
Source: AIG e-newsletter (received 28 July)
Income protection products launch on iPipeline
British Friendly’s Protect and Breathing Space Income Protection products are now available on iPipeline.
British Friendly provide flexible and inclusive cover that you can trust.
► They offer the widest choice of short term deferred periods from one, four, eight or 13 weeks on one, two or five year benefit periods.
► Offer a discretionary six month death benefit to all new and existing insured policies at no extra cost.
► British Friendly paid out 97.8% of all their claims in 2015 and 96.7% over the last decade.
Source: British Friendly Newsletter (received 01 August)
General Insurance News
Nearly nine in 10 homeowners struggle to understand home insurance
Home insurance is too complicated for 85% of UK homeowners, according to a survey by UKDN Waterflow.
The firm, which specialises in drainage and structural maintenance, said the study highlighted a discrepancy between owners and renters, with 42% of tenants believing insurance is too difficult to understand.
Renters are only eligible for tenants’ content insurers, said UKDN Waterflow, but when a home is bought the range and scope of policies “increases significantly”, suggesting this could contribute to the complexity of home cover for owners.
The survey also reported a “significant contrast” in the levels of understanding of the product among those who actually have cover and those who don’t.
For those who have insurance, 66% are “not at all confident” that they know what their policy entails. Of those without cover, 21% said they weren’t confident in their understanding of what is covered by contents and buildings insurance.
In addition, only 13% of owners with buildings insurance are confident of their knowledge about their policies.
Sharon Betts, client development manager at UKDN Waterflow, described the figure as “particularly worrying”.
“These figures make it clear that we all need to do more to educate the public so they’re fully and appropriately covered at their time of need,” she said.
The survey covered 766 people in total, 629 of which identified themselves as homeowners and 119 as renters, with the remaining respondents classified as ‘other’.
Source: The Actuary (published 01 August)
The article “Nearly nine in 10 homeowners struggle to understand home insurance” is available to share with your clients!! Here’s the link for you to share on social media: http://bit.ly/0508Client-article2.
Equity release lending hits a new record
Equity release is growing in popularity as a way to free up housing wealth and boost retirement incomes without needing to downsize, and as a result, the value of this form of lending is soaring to new heights.
New figures from The Equity Release Council show that homeowners aged 55+ withdrew a record £8.2 million of housing wealth every working day during the second quarter of 2016 (April-June), equating to a lending total of £514.4m during the three-month period – the first time the quarterly total has ever surpassed £0.5 bn.
This also marks an increase of 34% year-on-year – up from the £384.3m lending total of the same period in 2015 – and is 14% higher than the previous quarterly record set in Q3 2015, when £452.6m was lent in this way. Growth can similarly be seen in the number of equity release plans sold, with the number of new sales agreed (6,671) up by 23% year-on-year and representing the largest quarterly total since 2008.
The report noted that this increased appetite for equity release lending coincides with market developments, including new providers and an increasing choice of products and features, which will hopefully make it more viable for people to consider this form of lending.
All that released equity can be put to good use, too, with many using the proceeds to pay off existing mortgages and loans, provide extra retirement income, fund home improvements, and even gift money to family members as a form of ‘living inheritance’ – and there’s no need to leave the family home.
Sound appealing? Little wonder, and as an added bonus, there are plenty of types of plan
to consider. First up is the lump sum lifetime mortgage, which typically involves a large release of housing wealth in a single, lump sum payment – which could make it ideal for those who want to clear debts or gift money to relatives. This type of plan saw the strongest rise in popularity over the year, too, with £208.8m lent during the quarter – an increase of 37% from the £152.1m lump sum lending total of Q2 2015.
However, lending via drawdown lifetime mortgages continues to account for the larger market share, with the total standing at £304.0m (up 31% year-on-year). This kind of product allows customers to make multiple withdrawals of equity as and when needed, which could make it more suited to those who want to use their housing wealth to supplement their retirement income.
Home reversion plans, where the lender buys your home (or a portion of it) but allows you to continue living there, also experienced a rise during the quarter, although they still remain the least popular overall, with the total value of lending standing at just £1.5m (up from £623,647 in Q2 2015).
It’s all looking good for equity release at the moment – and for the customers who opt for this kind of plan – as Nigel Waterson, chairman of the Council, comments: “These figures are the latest sign that UK homeowners increasingly see housing wealth as a fundamental part of their retirement funding plans. The long term rise of house prices has allowed many older homeowners to build up considerable reserves of housing equity, which have the potential to solve many of the financial challenges facing the UK’s ageing population.”
Source: Moneyfacts.co.uk (published 01 August)
The article “Equity release lending hits a new record” is available to share with your clients!! Here’s the link for you to share on social media: http://bit.ly/0508Client-article3.
Power to Sell Workshops: Book your place now!
Following on from the recent announcement that our National Sales Conference is evolving into a series of Power to Sell Workshops, we’re delighted to announce the venues.
In case you missed it here’s an overview of what to expect in our new Power to Sell Workshops, including the newly announced venues.
The workshops will cover a range of topics including:
► Valuable sales skills in bitesize sessions.
► Highlighted opportunities across multiple channels to market.
► Buyer behaviours and qualifying the opportunity.
► Interactive sales solution technology demonstrations to support more sales.
Dates and Locations
Our Power to Sell Workshops will be hitting the road throughout September, starting at 09:00 and finishing at 13:00. Here’s a list of dates and locations:
► 05 September – Macdonald Houstoun House, Livingston.
► 06 September – Marriott Hotel MetroCentre, Gateshead.
► 07 September – Mercure Wetherby Hotel, Wetherby.
► 08 September – Cottons Hotel & Spa, Knutsford.
► 12 September – Windmill Village Hotel & Golf Club, Coventry.
► 13 September – Apollo Hotel, Basingstoke.
► 14 September – LDC Office, London.
► 15 September – Hilton Stansted Airport, Essex.
Click here to book your place today!
We’ll be releasing venue information shortly, look out for this update via e-mail over the next couple of weeks.
Banks turning to voice recognition
Voice as a form of secure ID is becoming more widespread, with Barclays announcing it’s using the technology for telephone banking customers.
All Barclays’ personal telephone banking customers are eligible to use the system, although they can opt out.
The technology recognises a customer’s unique formation of words, cancelling the need for security questions or passwords.
A number of banks are at various stages of introducing similar technology.
First Direct has been signing up some customers to the system since March. A month earlier, HSBC said it was introducing voice and touch ID in the summer.
Challenger institution Atom Bank allows its customers to log on via a face recognition system.
Barclays said that a customer’s “voice print” was made up of more than 100 characteristics based on the physical configuration of the speaker’s mouth and throat.
The system captures data on this “voice print” during phone calls, and once this is complete any further calls can be matched against this information.
It can still identify customers when their voice is changed owing to a cold or sore throat, or with age. Barclays says the system also recognises someone whose voice changes during gender reassignment.
Anyone mimicking a voice, or family members who sound the same, can’t cheat the system, it says.
The bank has been testing the technology with a limited number of customers since 2013, during which some known fraudsters were thwarted.
Steven Cooper, chief executive personal banking at Barclays, said: “We can all relate to the frustration of forgetting a password at the crucial moment. Voice security can cut out that part of the call completely and, unlike a password, each person’s voice is as unique as a fingerprint.”
James Daley, founder of consumer website Fairer Finance, said anything that sped up the security process would be welcomed by customers.
“Banks will need to be ready to reassure people that this new technology is genuinely secure. New security processes can make customers nervous – and it’s important that this doesn’t lead to any loss of confidence in bank security,” he said.
“In reality, consumers should have little to fear, as banks are still liable for any fraud unless they can prove that a customer was negligent. So if this technology does lead to any increase in fraud, it will be the banks that have to pick up the bill, and not customers.”
Source: BBC News (published 01 August)