Future proofing your advice with business protection

15 January 2021
Talking to your clients about savings, investments, mortgages to name but a few is your bread and butter, but are you missing an opportunity to talk to their children about these topics too?

It could be a simple reminder to check if they’ve got a savings vehicle such as a Child Trust Fund in place; how is it performing and what do they plan to do with the fund? And would a discussion about transferring to a Junior ISA be worth having?

Child Trust Funds

Last September marked the coming of age for Child Trust Funds, which launched back in 2002. This means that millions of lucky young adults are about to get their hands on what could be a very hefty piggy bank, with some funds estimated to be worth up to £70,0001.

Will this newfound wealth help many to move onto the property ladder? Fund part of their university tuition or maybe they’ll find freedom with driving lessons? But how will the COVID-19 pandemic have changed how they view their finances? Will they be more inclined to spend or to save? Some interesting research carried out by Orbis Investments found that 44% of people about to access their Child Trust Fund were unsure about what they were going to do with it, 23% planned to continue to save their money but an estimated 62% of 16 and 17-year-olds with a Child Trust Fund, weren’t even aware they had an investment in their name.2

Grow your client bank

This got me thinking, there are endless avenues to grow your future client bank. Child Trust Funds may be one option, but are there other opportunities that might be closer to home? What about protection?

There are endless avenues to grow your future client bank. Child Trust Funds may be one option, but are there other opportunities that might be closer to home?

Take critical illness cover as an example. If your client takes out critical illness cover with Royal London and they select the enhanced Children’s Critical Illness Cover option, a child conversion option will now be automatically included. This means the child will be able to take out a policy of their own within six months of the latest of their 21st birthday, if they’re not in full time education, or their 23rd birthday if they are.

Furthermore we’ve recently introduced the child conversion option onto our Business Menu Plan, which means if you’ve got owners of small businesses within your client bank who have a critical illness policy with Royal London you could be about to open the door to a raft of future clients.

Let’s look at a case study to understand where the opportunity is:

Case study: RL Sockets Ltd.

Ruth is the managing director of RL Sockets Ltd, a small manufacturing firm based in Scotland. She’s 47 years old and has an annual income of £95,000. She has a 19-year-old daughter, Simone, who’s been working in the family business having left school two years ago and is expected to take ownership of the business in the future.

As a key employee of RL Sockets Ltd, Ruth took out a key person protection policy on a life or earlier critical illness cover basis with a sum assured of £100,000. Ruth also chose the enhanced children’s critical illness option. The monthly premium for the policy is being paid for by the business.

Simone recently discovered she’s pregnant and, as she’s still covered under her mum’s enhanced children’s critical illness cover will be protected for pregnancy complications covered under the plan. Furthermore, as she’s not in full time education when she turns 21, she’ll have the option to take out her own critical illness cover with Royal London for the same amount she was covered for under her mum’s plan, up to a maximum of £50,000.

How can this be advantageous to you and your clients?

From an intergenerational planning perspective, you’ve just got yourself a brand new client. As we saw in our case study, Simone is expected to be the future owner of the business which perhaps opens up further opportunities for you to talk about business protection. Simone may decide to pursue a different career, but the fact remains, she’s still a client.

From an intergenerational planning perspective, you’ve just got yourself a brand new client.

For Simone, she’s able to get critical illness cover with no medical underwriting even if she were to have an underlying health condition. Being a non smoker, she'll also benefit from non-smoker rates, as well as having the advantage of being at the beginning of her adult life which will likely result in very favourable premiums.  

When Simone reaches age 21 (or 23 if she was still in further education) Ruth can contact Royal London to instruct us to remove the enhanced children’s cover element from the policy. This would mean the monthly premiums would reduce, resulting in a small saving. A benefit for Ruth too.

How do you make the most of this opportunity?

With the recent addition of the child conversion option within our Business Menu Plan, why not use this as a talking point with business protection clients who either have a young family or are planning on starting a family.  It’ll not only show the quality of your advice, but it could help you to future proof your client bank for years to come.

And remember, the flexibility of the Royal London Business Menu Plan allows for a wider choice of covers under one plan. The main objective of your conversation may have been around protecting a key person within their business or perhaps just providing some protection towards their mortgage, but with a multi-benefit protection solution like the Personal or Business Menu Plan you can ensure that your client is covered for more than just death.

For more information about our enhanced Children’s Critical Illness Cover or indeed our Business Menu Plan speak with your usual Royal London contact or visit our website.  

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2 - Orbis Investments via



About the author

Gregor Sked

Protection Development and Technical Manager

Gregor’s exposure to financial services began back in 2011. Most of his early career was spent at Standard Life where he was a presenter in the workplace pension engagement team. He joined Royal London in 2018 to spend more time on protection in the Intermediary market. Gregor is involved in developing adviser facing content, presenting, writing articles and commenting for the press. Gregor is also studying towards a Diploma in Financial Planning through the CII.

This website is intended for financial advisers only and shouldn't be relied upon by any other person. If you are not an adviser please visit royallondon.com.

The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial Services Register, registration number 117672. It provides life assurance and pensions. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL.