Protection Guru Analysis: helping advisers cover the additional cost of Consumer Duty compliance

• Data reveals Consumer Duty benefits for both consumers and advisers
• Protection Guru Pro users earned nearly £300 additional commission per policy by recommending the best value plans for clients 

Protection Guru, the multi award-winning specialist technical information provider for protection advisers today releases details of the commercial benefits advisers achieved using their Protection Guru Pro (PGP) software during Q4/2024 – all while benefitting consumers.

As the only service that allows advisers in the UK to look at quality and price to assess value across the full suite of protection products, PGP enables advisers to meet their FCA consumer duty obligations to identify the protection products that represent best value for their clients, rather than simply the cheapest across life insurance, critical illness, income and business protection. 

The data released this morning identifies that on average, during Q4/24 system users earned an additional £295.60 per policy by using the software to identify the best value product to meet individual client’s needs, delivering better consumer outcomes. The table below shows the average increase in income for advisers based on each different type of product where best value was recommended rather than cheapest price:

Commenting on the data Protection Guru founder Ian McKenna stated: “First and foremost, our system is about identifying best value for consumers. Any additional revenue to compensate extra work advisers must do is a fortunate byproduct. 

“For too long, the industry was guided by the Financial Ombudsman Service to prioritise the cheapest plans over those that represented best value. Consumer Duty changed this, but it puts significant additional burdens on advisers and necessitates changes working practices. This can be a major challenge, particularly when conversations start with price comparison and consumers end up fixated on the lowest price. By assessing quality first advisers can contrast quality and price to identify best value.  

“We are pleased to demonstrate how delivering on FCA Consumer Duty obligations also can increase adviser income. This should be a huge driver for implementing revised business processes.”

Protection Guru’s data shows that frequently a plan that is better suited to the consumers’ needs, will only cost a few pounds or even pennies more, a determining factor when protecting one’s income.

Further, use of the system shows 85% of consumers prefer a better value plan over the cheapest one and plans tailored around best value are more likely to stay in force because the client understands the value and benefits they are receiving.

Adding a cautionary tone McKenna observed: “The FCA have made it clear that they expect advisers to assess value across all protection products. If you are using a system that only analyses quality for Critical Illness, are you putting a target on your back when you get a Consumer Duty visit from the FCA?

“Our service enables advisers to assess value for life protection, income protection, critical illness, family and income benefit and key person plans at a competitive price. On average an adviser will make up for the annual license cost by putting two plans a year through our system. After that, every client advised increases revenue.”