more 2 life welcome to our webinar 1 welcome to our webinar enhanced equity release
TRANSCRIPT
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more 2 lifeWelcome to our webinar
Welcome to our webinarEnhanced Equity Release
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Introductions
Stuart WilsonChannel Marketing Director
• 25 years’ Financial Services experience• Worked for Primetime Retirement/Living Time,
LV=, Just Retirement and Friends Life
Mike MillarHead of Sales
• Previously Equity Release Director at Partnership• Focused on product development and worked on
pioneering products including introducing enhanced equity release into the market
Agenda
• Learning outcomes
• more 2 life
• The market
• Drivers for change/growth
• The challenge
• Asking the right questions
• Enhanced Plan
• Q&A
Learning outcomes
• After this webinar you will have an understanding of and be able to identify:
1. The opportunities and growth in the lifetime mortgage market
2. The challenges in the market and the need to ask your clients about their health and lifestyle
3. The benefits of asking the right health questions
5
Housekeeping
• Raise a hand• Ask a question
Send
Will copies of the slides be available?
Enhanced Equity Release:Are you asking the right
questions?
Mike Millar
About us
• more 2 life is an innovator and pioneer in LTM market.
• New management team Dave Harris, M.D, Will Hale, Business Development Director, Stuart Wilson, Channel Marketing Director and Mike Millar, Head of Sales.
• Continues to focus on adviser firms with market-leading products and special deals.
• Looking at new funders
Growth of Lifetime Mortgage market
• Market enjoying new boom• Lending levels back to pre-credit crunch
levels and set to grow further
Source: Equity Release Council
2011£788.6M
2012£925.7M
2013£1.07B
Drivers for change/growth…
• Ageing population – average male life expectancy at age 65 now 22 years, will be 25 by 2050
• Retirement saving shortfall• Rise of retirees who are asset rich / cash poor• Cultural shift to lifestyle vs. inheritance
obligation• Long-term care funding need
Drivers for change/growth…
• Recent Budget announcements will stimulate innovation and awareness
changes to annuities will require “a whole different approach to funding retirement”
Paul Smee, Director-General, CML
Drivers for change/growth…
Harold• Retired at 65• Life expectancy limited
(c.5 years)• Retirement planning
choices limited (annuity)
Harry (great grandson)• Retirement is phased• Life expectancy 20+
years• Holistic retirement
planning choices huge…and about to get bigger
Changing face of retirement
Drivers for change/growth…Equity Release following annuity model
Standard Lifetime Annuities
Smoker Annuities
Enhanced Annuities
(Over 1000 conditions)
Standard Equity
Release
Enhanced Equity
Release
The challenge
• PAFS introduced medically underwritten annuities into the UK in 1995
• By 2004 less than 10% of the annuities bought were enhanced.
• Heightened awareness and the introduction of TCF meant that by 2013 as many as 60% of annuitants could qualify for some form of enhancement.
The challenge
• Around 2009 a website appeared www.missoldannuity.co.uk
• The ambulance chasers are now on the case
“Have you been asked medical
questions?”
“You could be entitled to
compensation”
“No, why?”
The challenge
What’s this got to do with equity release?Everything• Under TCF outcome 4 you must take all your
client’s circumstances into consideration.• Do you always ask your clients about their
health?
The challenge
2007 2014
Missoldequityreleasedot com
Enhanced Equity Release first launched in UK
How many clients who would have qualified for an enhanced LTV received a standard one instead?
Did you know?
Did you know?
The question you shouldn’t ask
Are you fit and
healthy?
Fit as a butcher’s
dog!
He doesn’t need to know
about the statins I take…
OR
YES NO
Health Questions
The questions you should be asking
+
If you smoke manufactured cigarettes, have you smoked 10 or more cigarettes per day for the last 10 years?
If you smoke rolling tobacco, have you smoked more than 3ozs or 85g per week for the last 10 years?
Have you been diagnosed with high blood pressure, requiring on-going medication?
Have you suffered a heart attack requiring hospital admission?
Do you suffer from diabetes, requiring insulin or tablet treatment?
OR
YES NO
Health Questions
The questions you should be asking
+
Have you suffered from a stroke (CVA), excluding mini-strokes (TIAs) ?
Have you suffered from angina, requiring on-going medication?
Have you been diagnosed with cancer (excl. skin cancer and benign tumours) requiring surgery, chemotherapy or radiotherapy?
Have you been diagnosed with Parkinson`s disease?
Have you been diagnosed with multiple sclerosis?
Have you taken early retirement on the grounds of ill health?
Our Enhanced Plan at a glance
• Takes into account health and lifestyle conditions to allow a larger release
– No medical examination required– No monthly repayments– The loan, plus interest, is repaid when the property is sold– Cash facility available so your client can release more money in stages
if they wish to*– Protected Equity Guarantee option meaning an inheritance can be
guaranteed to your clients’ beneficiaries– Straightforward application process
* Subject to prevailing criteria at the time of application for further funds.
Enhanced Plan eligibility
• For our Enhanced Plan, clients must meet the following lending criteria:
– There is no maximum age– Have a health or lifestyle condition which makes them eligible for the
Enhanced Plan. – Have UK or EU citizenship with permanent rights of residency in the UK– Resident in the UK and able to provide an address history covering the
last 36 months– Property must have a minimum valuation of £60,000. Maximum loan
amount is 100% of the LTV on first million and 50% of the LTV on second million.
– If the property is leasehold, our criteria for the minimum number of years left on the leasehold must be met.
Enhanced LTVs - examples
5minutes
13questions
+£15,000
USPs
• Enhanced/Max cash– Enhanced terms based on age, lifestyle and
health (higher LTVs )– Drawdown available – Protected Equity Guarantee (PEG)– Medical questions
• Cancer not restricted to last 5 years• Parkinson's no requirement for aids for everyday
living • MS no requirement for aids for everyday living
Questions…
More information…
This is a lifetime mortgage. To understand the features and risks ask for a personalised illustration.