Cash Back on Life Assurance etc - Is there a catch?

Hi There,

We're looking into Life Assurance and Income Protection before being able to draw down a mortgage and after some searching on the site I see that a number of online brokers are recommended and that they offer very generous Cash Back incentives. Our own broker with whom we are getting the mortgage has provided us with two suppliers for Life Assurance and Income Protection but neither offers any reward or incentive. Are we doing ourselves out of money by going the traditional route with the broker? Is the Cash Back offer really as good as it seems with no catches/clauses etc?

Thanks in advance,

Pumpkin

The various brokers that offer cash back generally operate an "execution-only" service, i.e. you don't get advice on what type of product is most suitable for you. So you need to know exactly what type of cover you need before approaching a discount broker. There's no catch.

The online broker rebates offered on first year premium are genuine. The only clause of note in most cases is that you must leave the policy in force for at least 1 year.

While they are done on an execution only basis, term life assurance products especially for mortgage protection are more or less generic products and therefore price is the biggest consideration for most customers as they simply wish to get cover to keep their mortgage provider satisfied that cover is in place for them.

While the service offered is execution only and not advice driven, I know that some online brokers will clarify queries on products if you give them a call.

I went with such a broker, got about 3/4 of the premium back in the first year (about 6-7 month into the contract), there were no catches, no problems.

Most of the online brokers I know are more then happy for you to phone them or call into them and get the advise you need. Any of the online brokers that I have dealt with the staff are all QFA qualified and offer the same level as the more traditional financial adviser. They just don't charge as much commission. So no catch. (i work in a company related to an online broker)