MPPI – ‘Demands and needs’ checklist: advised sales

Completion of the checklist below will help you to gather the information you’ll need to produce a compliant ‘Statement of demands and needs’ for your customer as part of an advised MPPI sale.

Please note that this checklist is designed to support TCF, it is not a substitute for FSA rules on insurance sales. Follow the links at the end to the FSA ICOB rules.

Customer demands

Step one: Please discuss the points below with the customer and complete or ask the customer to self complete and return.

Attitude to risk

Please place a tick against one or more of the following statements

I am/we are: Very interested in protecting my/our mortgage payments Interested in protecting my/our mortgage payments Only interested in protecting my/our mortgage payments if I/we can very comfortably afford the policy

Type of product

Are you interested in a policy that covers your mortgage payments for a set period if you’re unable to work due to accident, sickness or involuntary unemployment or in a policy that provides a regular income for a set period?

COVER MORTGAGE PAYMENTS PROVIDE INCOME NOT SURE

Level of cover

Minimum monthly payment sought in the event of a claim (please tick one option)

£_______ PER MONTH ___% OF SALARY AS HIGH AS I CAN REASONABLY AFFORD ENOUGH TO COVER MY MORTGAGE PAYMENTS

Payment options

Would you prefer to pay for the policy monthly or upfront with a single payment?

MONTHLY SINGLE UPRFRONT PAYMENT CHEAPEST OPTION DON’T MIND

If you chose ‘Single Payment’ would you want to add this (if possible) to the mortgage loan (note that you would pay interest on the amount over the life of your mortgage so it would cost you more)

YES NO NOT SURE

Flexibility/cancellation

Please indicate how important the following features are to you:

The right to cancel early	QUITE VERY
MPPI policy to continue if you remortgage (change lenders)	QUITE VERY
The right to a refund if cancelling early if paying a single (upfront) premium*	QUITE VERY
MPPI monthly premiums can be adapted where required if you increase/decrease your mortgage*	QUITE VERY

* MPPI policies require either one upfront payment (‘single premium’) or monthly premiums: we will advise you on which we think is most suitable for you.

Set-up costs

How important are low set-up charges to you?

QUITE VERY

Other demands requested by the customer

(Customer demand)	(Comment)
(Customer demand)	(Comment)

Continue on separate sheet if necessary

Customer needs (adviser led)

Step two: Using the information you gathered during the mortgage Fact Find and/or any separate MPPI Eligibility Assessment, please complete the required information or tick the relevant options.

Age

Customer age fits eligibility criteria for MPPI

YES NO

Existing Insurance/company benefits

Customer has relevant existing insurance/company benefits	YES NO
If above is YES, please give brief detail and effect on need for MPPI:

Affordability

Estimated monthly surplus after income/outgoings, including current/proposed mortgage	£______/month
Future income (please tick one)	Customer’s income expected to rise during the contract period Customer’s income expected to stay the same during the contract period Customer’s income expected to fall during the contract period
Customer has sufficient surplus income (current and future) to afford a monthly premium	YES NO
If above is YES, enter estimated maximum affordable monthly premium based on current and future likely income/outgoings:	£_______ max per month
If above is NO, how would the customer afford a policy? (please tick one)	Policy not affordable Customer has savings to pay the single premium upfront Customer could afford to add whole of single premium to loan Customer could afford to add part of single premium to loan and pay the rest with existing capital
Total cost of full/part premium if added to the loan, based on current interest rates	£_______
Based on the above information do you feel that the customer could reasonably afford MPPI?	YES NO

Timing/flexibility of cover

Customer has relevant existing insurance/company benefits	______YEARS
Customer requires ability to cancel early due to the possibility of (please tick):	retirement moving abroad career change repaying the mortgage future reduced income affecting affordability N/A
Customer requires ability to re-assign the policy to a different mortgage	YES NO
If taking a monthly premium product, the customer requires ability to increase/decrease the insured amount during the contract period	YES NO

Other customer needs, based on the Fact Find/ Eligibility check

(Customer demand)	(Comment)
(Customer demand)	(Comment)

Continue on separate sheet if necessary

Suitability assessment

Based on the above information, would MPPI would be a suitable product for the customer?

YES NO

Continue on separate sheet if necessary

Step three: having considered the customer’s demands and needs, and taken into account affordability, are you able to recommend a suitable MPPI policy from those available to you?

Policy can be recommended	YES NO
If the answer is NO, please confirm why, making references to the customer’s demands and needs:
If the answer is YES which product/s did you consider?	Product name Product name Product name
Which product do you recommend?	Name of recommended product: __________________________ Monthly premium £___________ or Single premium £ ____________ Premium to be added to the loan? YES/NO/IN PART

Demands and needs not met by the recommended contract and to be highlighted to the customer

Insert here Insert here Any more like this

Reasons for recommendation

Please explain why you think this product is suitable for the customer, given its costs and taking into account any exclusions or limitations of the contract in relation to the customer’s demands and needs. If you have chosen from a range of suitable products, please say why you are selecting the one you are. (Expand this box as necessary)

Step four: Use all of the relevant information above – together with information from the ‘Need to know’ customer statement - to create a ‘Statement of demands and needs’ for your customer. For further information on the format this can take follow the links to the FSA below.

While this checklist is designed to support TCF, it is not a substitute for FSA rules on insurance sales. You can check the FSA rules by following the links below.

FSA related links

FSA Advising and selling standards (insurance) (opens new window)
Statements of demands and needs – FSA rules (opens new window)
Insurance disclosure – information you give customers about your firm and their demands and needs (PDF document, 60K)
Payment protection insurance factsheet (PDF document, 88K)