P
Pjomes
Guest
Hi,
I have been living in the UK previously and have moved to Ireland recently. We are building a family home and as part of the process we had to take out a mortgage protection policy. I went to a financial advisor who showed me the various insurers and their respective premium for this cover. I went with the cheapest on his recommendation and the policy was arranged easily. I did not have to pay a fee as he advised the insurers pay him by way of a commmission.
When I received the Policy Document, I couldn't help noticing the 'intermediary remuneration' table. My premium is over €100 per month however the total commission was nearly €2000! I left it there and thought no more about it as I had got the best rate in the market anyway.
The issue arose again on Monday when a number of my colleagues and I met our Pensions Consultant in our Head Office. The meeting was actually just about joining the Scheme and the costs and benefits etc. They mentioned that they are remunerated by our company on a fee-based scenario and as a result we get better allocation on our contributions as they take no commission from the provider. I had mentioned the scenario with regard to Mortgage Protection commission and they advised that, based on their discussions with Insurance Companies, the premiums would be 20-25% lower for the customer if no commission was taken.
My family and I would have paid these fees in the UK over the years for any financial advice we got, however I can't help but think that the consumer here is getting a raw deal. The premiums are obviously going to have to take account of these, obscene in my opinion, levels of commission. If I was to pay an upfront fee for advice of €200-400, I could in theory get a reduction in premium from €100 per month to €75 per month...sure I'd make that back in about a year or so anyway.
I am happy to pay for financial advice, but this system seems a bit odd to me.....I would be grateful if any of the contributors have any opinions in this regard....Am I missing something here?
Phil
I have been living in the UK previously and have moved to Ireland recently. We are building a family home and as part of the process we had to take out a mortgage protection policy. I went to a financial advisor who showed me the various insurers and their respective premium for this cover. I went with the cheapest on his recommendation and the policy was arranged easily. I did not have to pay a fee as he advised the insurers pay him by way of a commmission.
When I received the Policy Document, I couldn't help noticing the 'intermediary remuneration' table. My premium is over €100 per month however the total commission was nearly €2000! I left it there and thought no more about it as I had got the best rate in the market anyway.
The issue arose again on Monday when a number of my colleagues and I met our Pensions Consultant in our Head Office. The meeting was actually just about joining the Scheme and the costs and benefits etc. They mentioned that they are remunerated by our company on a fee-based scenario and as a result we get better allocation on our contributions as they take no commission from the provider. I had mentioned the scenario with regard to Mortgage Protection commission and they advised that, based on their discussions with Insurance Companies, the premiums would be 20-25% lower for the customer if no commission was taken.
My family and I would have paid these fees in the UK over the years for any financial advice we got, however I can't help but think that the consumer here is getting a raw deal. The premiums are obviously going to have to take account of these, obscene in my opinion, levels of commission. If I was to pay an upfront fee for advice of €200-400, I could in theory get a reduction in premium from €100 per month to €75 per month...sure I'd make that back in about a year or so anyway.
I am happy to pay for financial advice, but this system seems a bit odd to me.....I would be grateful if any of the contributors have any opinions in this regard....Am I missing something here?
Phil