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Mortgage Adviser talks to Justin Harper, head of intermediary marketing strategy for LV=, about the revolution.

MA: Shaking up the world of mortgage payment protection insurance is a bold claim, what is so revolutionary about LV='s Mortgage & Lifestyle Protection?

JH: What we have managed to do is translate some of the long-term aspects of traditional income protection into the simpler and slicker world of mortgage payment protection insurance and wrapped it around the mortgage advice process. In terms of unique features compared with MPPI it is really the quality and duration of the cover available. It is not limited to 12 months or two years, it is for the full duration of the mortgage term. The client can also choose additional living expenses to run to a different term to suit their personal needs and make sure they both keep the roof over their heads and maintain a decent standard of living.

MA: What sort of process will the mortgage adviser and their client have to go through to obtain Mortgage & Lifestyle Protection?

JH: We are working closely with the leading mortgage sourcing tools to put our products in the insurance options that every mortgage adviser can see and access when sourcing a mortgage. We are already working with Mortgage Brain and we will soon be on Trigold too. We are ensuring all the information they require to source a mortgage for a client can be pre-populated into the quote screen and it then comes back with a series of eight options of different levels of cover and the different initial prices. If the client is happy with that the adviser can explain the cover and submit the proposal to LV=. We take over from there and complete a telephone interview. The adviser does not have to worry about any of the disclosure requirements. The onus and the responsibility falls on LV=. We have trained UK-based telephone interviewers that can talk the client through the sort of information we need to make sure the level of cover they get is appropriate, we understand the risk and they get a fair premium. Throughout that process the adviser is kept informed electronically of when the telephone interview is set up and when it has been done. At the end of the telephone interview the client is told then and there they have got the cover.

MA: What sort of commission is available for mortgage advisers?

JH: Because it is a long-term contract for a £50 a month plan we are talking about several hundred pounds commission. It is a proper reward for doing a proper adviser job. The product allows the adviser to have a treating customers fairly solution. Everybody wins and hopefully it will help mortgage advisers with their straining income streams at the moment plus there is a quality product behind it.

MA: The reputation of the payment protection insurance market and by association mortgage payment protection insurance is hanging by a thread. How does Mortgage & Lifestyle Protection tackle the criticisms levelled at the industry?

JH: Payment protection insurance has received a great deal of criticism and we have trawled through the initial findings of the Competition Commission's report. In some ways mortgage payment protection insurance has been lumped in with PPI but the report points out there are no real problems with MPPI. MPPI has been falsely aligned with PPI however we still think there are flaws with traditional MPPI. The short-term duration of the cover and the one size fits all approach, the lack of choice and flexibility for the client and probably the most serious aspect from the consumers' point of view is are they able to be confident that when it comes to making a claim it will be paid. Mortgage & Lifestyle Protection tackles those problems and accusations. It is a tailored plan. It is underwritten and we obtain all the relevant information upfront. We have an enviable income protection claims record, which we publish and are one of the few providers to do so.

MA: How does the claim process for Mortgage & Lifestyle Protection differ from that for MPPI?

JH: When you look closely at some traditional MPPI products they are not that easy to explain and one of the bits of information that is not on the FSA's comparison tables is when you come to claim who pays the expenses. On many traditional MPPI the customer has to pay but LV= will pay those costs.

MA: Consumers are confused by the idea of protection and the choices available, what are you doing to address this?

JH: There is a much greater appetite among mortgage advisers to supplement their income given the current housing market. We have made sure Mortgage & Lifestyle Protection is wrapped around the mortgage application process so it feels very natural to talk about a protection mortgage. Mortgage advisers are providing the funds for people to have a roof over their heads so it makes sense to make sure they can keep the roof over their head. We have a dedicated microsite, www.LVmlp.co.uk, which has freely accessible learning material. They can learn about the process, the need for income protection and how our policy works. We are translating that material for the www.ftadviser.com gym. Also, we are working with mortgage sourcing tools to make sure advisers are aware of the material plus we are taking it out on the road with trade shows and distributor networks. We have been overwhelmed by the positive response.

MA: You launched your new product at the end of May, what has the reaction been so far?

JH: The overwhelming response has been generally positive from networks, advisers and industry commentators. Mortgage & Lifestyle Protection ticks all the boxes of what mortgage advisers are looking for. It is a simple solution and quality cover. Mortgage advisers have been impressed and that has been reflected in the level of initial interest we have had. In the first week we had nearly 1000 advisers seek a quote, which was very impressive indeed. That level of interest is continuing to grow. We also got a glowing report from Defaqto, which gave us a five-star rating.

MA: LV= is a new player in the mortgage adviser market, what are you doing to make advisers aware of your product and how it can benefit both them and their clients?

JH: We are working with the sourcing tools and identifying mortgage advisers and proactively contacting them over the telephone plus having face to face meetings to make them aware of LV= and Mortgage & Lifestyle Protection. We are also working with Mortgage Adviser, sister newspaper Financial Adviser and www.ftadviser.com to help raise awareness. We are taking every opportunity to raise the profile of the product. We are also launching a promotion to encourage mortgage advisers to visit the microsite www.LVmlp.co.uk. We recognise advisers have less and less time to attend roadshows so we want to make ourselves as accessible as possible, which is why everything you need to know is sat on the website.

To find out how to win a holiday with LV= click here.