There is an issue with banks selling insurance if they offer lower interest rates, large loans or larger credit lines in return for the insurance business.
How is a banker going to realistically explain to a client the difference between the loan amount and the policy limit for the property being financed? There is a definite conflict of interest when one combines the two services.
I’m concerned the client may believe loan acceptance or loan rate my be conditioned upon also purchasing insurance coverage; even if the bank never says so. Designing, negotiating and placing insurance programs for exceptionally sucessfully clients is complex, requiring high levels of experience and insurance contract expertise. In my opinion, it must be the broker’s only practice, not an add-on option.
Believe me, they are doing that now – gently reminding them that there loan will easily be approved “if you let us write your insurance”. I have had several clients tell me this. Very frustrating – one more competitor to deal with.
There is an issue with banks selling insurance if they offer lower interest rates, large loans or larger credit lines in return for the insurance business.
How is a banker going to realistically explain to a client the difference between the loan amount and the policy limit for the property being financed? There is a definite conflict of interest when one combines the two services.
That is what I thought as well Huh!!!! how can you combine the two services?
I’m concerned the client may believe loan acceptance or loan rate my be conditioned upon also purchasing insurance coverage; even if the bank never says so. Designing, negotiating and placing insurance programs for exceptionally sucessfully clients is complex, requiring high levels of experience and insurance contract expertise. In my opinion, it must be the broker’s only practice, not an add-on option.
Believe me, they are doing that now – gently reminding them that there loan will easily be approved “if you let us write your insurance”. I have had several clients tell me this. Very frustrating – one more competitor to deal with.