KEEPING UPWITH THE JONESES

Fortunately, Simon Jones’ enterprising nature has helped him to evolve his business for almost two decades now – through both sides of the recession. With his father being an established estate agent in Irlam, just outside Manchester, mortgage advice was a natural career path for Simon and his brother Andrew. After gaining the necessary qualifications, they set up in partnership with the family business and it soon became a success.

‘We’d both worked for other companies before,’ explained Simon, ‘but once we were fully qualified, the opportunity was too good to turn down. There was a ready-made stream of clients and it didn’t seem like there was an awful lot of risk at the time – it was good for everyone.’

CHOOSING THE RIGHT MORTGAGE STRATEGYSimon told us he’s been recommending Paymentshield products for almost as long as he’s been a financial adviser. And it’s a relationship that has served him well over the years – with fate playing its part on more than one occasion.

‘15 years ago I opened up a Mortgage Strategy magazine and a CD fell out from Paymentshield saying that I could earn money by writing more GI business. It sounded interesting and I talked to my dad about it at the time, but he wasn’t convinced. He thought it was a lot of effort for very little return and told me as much. But I looked into it and thought – I’m going to do this.

‘I’ve worked with Paymentshield ever since and GI has been very profitable for me. It’s become a running joke with my dad. He still asks me how I’m doing with Paymentshield and if I’m making any money yet. But these days I don’t even need to answer!’

THE SECRET TO GI SUCCESSFor many advisers GI doesn’t always get top billing in terms of revenue or income. But what people like Simon have found is that besides being the perfect complement to mortgage business, and a very easy sell, it’s also rather profitable.

‘I can’t understand why people don’t pursue it,’ he explains. ‘The commission might not seem like much compared to other finance products, but it all adds up and once you’ve got a steady client base it can have quite an impact. I’d say that GI probably pays for all of our office admin costs. That’s a lot of money over the course of a year and it means that everything else becomes profit.‘

He’s also quick to recognise that GI business is a great way to strengthen client relationships. ‘The way I see it, if I’m not looking after my clients, someone else will. By letting them go elsewhere, it’s not just the GI I need to worry about; I could end up losing the mortgage business as well. Plus, the more you do with customers, the more they trust you.’

He’s got a point. If you are prepared to pick and choose products based on profitability, it puts the whole principle of ‘good advice’ into question. A more holistic approach certainly displays much more in the way of customer focus and professional integrity.

You don’t survive 17 years in the financial services industry without being able to recognise a good opportunity when you see one.

¹Paymentshield offer a range of commission options to suit your business. The commission percentages shown are based on our standard commission rate of 27.5%. Commission rates may vary. If you are an appointed representative and interested in changing your commission structure please consult with your Principals Head Office

DOUBLE INDEMNITY: YOU WON’T NEED TO BE ASKED TWICE It hasn’t all been plain sailing for Simon and Andrew Jones. For the first few years they established a steady flow of clients and a reputation for great service, but then in 2007 the recession hit. Simon remembers it vividly, ‘It seemed to happen overnight. The phones literally stopped ringing and even though we were doing well as a business, it was a worrying time.’

Once again, Paymentshield was on hand to help. ‘I can’t remember all the details, but we basically got a leaflet through the door asking if we’d like to change our commission terms from monthly drip, to double indemnity. It wasn’t something I’d come across before, from any provider, but we signed up without hesitation. It was a no-brainer really. It meant we got more up-front commission, which took the pressure off and really helped with cash flow.’

He also believes that it has only ever had a positive impact on his income. ‘Our retention figures have always been good, so I’ve never been too worried about claw back. And the fact that you get more money up-front makes up for any slight commission increase we might get on annual indemnity terms. Put it this way, our business has been busy for a good while now and we haven’t seen the need to revert back. We’re happy as we are.‘

The truth is, Simon’s business has grown from strength to strength. The two brothers have been joined by a third adviser, Joanne Hobson, and between them they offer advice on everything from mortgages and GI, to pensions, investments and annuities. With things going so well, they are also hoping to bring in more advisers in the near future.

TIPS AND ADVICE ON WRITING MORE GI BUSINESS1. MAKE GI PART OF THE MORTGAGE PROCESS‘As far as I’m concerned, when people come to ask about a mortgage, GI is all part of the service. I explain to my clients that they’ll need insurance and that I will obviously help them out with that. They rarely question this approach and usually see it as a bonus.’

2. EXPLAIN THE LEGAL RAMIFICATIONS ‘I also make the point that most mortgages come with a legal requirement to have the right insurance in place. This usually confirms to clients that they’re better off letting me deal with it. ’

3. TAKE THE HASSLE AWAY‘Nobody wants to spend hours on the phone or online researching insurance deals. Nine times out of ten, my clients are delighted that I’m taking the hassle away from them. It can seem like a complicated process to a lot of people – even though it isn’t.’

4. DON’T LET COMPARISON SITES GET IN YOUR WAY‘Occasionally, people think they can get a better deal online. But I once had a client who came to me a few days after her mortgage had been agreed in principle, to say it had been declined due to an adverse credit rating. It turns out that she had been on a comparison site to sort out her home insurance and it had affected her rating – not just once, but with 30 or 40 insurance companies that had all been contacted automatically. It resulted in her losing her mortgage. I always explain to my clients that they get a better market comparison through me and it doesn’t affect their credit rating in the slightest!’

5. GET A GOOD DEAL‘It’s like anything. If you get your clients a good deal, they’ll appreciate your help. There will always be one or two cheaper insurances available online. But when clients come to me, they know that they’re getting a good deal with a reputable company.

DOUBLE INDEMNITY FROM PAYMENTSHIELD1

Boost your up-front income and help the cash flow of your business. Here’s how it works:

From year three onwards your earnings revert to 27.5% indemnity.

Speak to your account manager to switch your commission structure today.

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