The vast majority of brokers now recognise the importance of offering clients additional value-added products when writing a home loan, a new survey has found.

The findings, revealed in the Choice Aggregation Services (Choice) 2009 member survey, re-affirmed the recent industry shift towards a diversified service offering and brokers’ drive to better client servicing.

On overwhelming 81.5 per cent believed that it was appropriate to offer clients additional products while just 10.8 per cent of members surveyed believed it was not; 7.7 per cent were unsure.

Brendan O’Donnell, CEO of Choice, said that the result aligned with the aggregator’s ongoing focus to empower broker diversification.

“Choice has long advocated diversification to its members and it is clear that this message has been almost universally adopted. We don’t view customers as borrowers - they are clients - and that means that our members’ responsibility goes way beyond just focusing on their loan requirements.

Mr O’Donnell believes that it’s essential for brokers to diversify their product offering in order to ensure ongoing business growth and their client servicing proposition.

“Forging deeper client relationships through a wider product offering will help brokers maintain revenue through all market conditions as well as strengthening their client service offering,” he said.

“Our focus as a business moving forward will be to ensure the continued depth of our lending panel by adding commercial products, leasing and finance, insurance as well as other appropriate banking products. This reflects the evolution of our business as one that is focused on financing broking, rather than just mortgage broking.”

According to the member survey, 74.7 per cent of respondents currently offered insurance to their clients - highlighting the growing popularity of these products and the need for Choice to continually evaluate and evolve its member servicing offering.
Paul Wright, principal of Illawarra-based IPS Home Loans, is one Choice member that has embraced a diversified offering, in particular mortgage protection insurance.

He believes that brokers have a moral obligation to their clients to offer insurance when taking on a mortgage or significant debt commitment. “It is a good business practice but also a value add to our clients should the unforeseen occur,” he said.

Mr Wright said that the Australian Life Insurance (ALI) offering is quite popular with clients, with a large percentage continuing the cover after the initial free three month offer.

“I believe every customer needs some form of insurance and the ALI offer resonates with our clients - it’s fast and easy to arrange and meets a lot of our clients’ needs.

“As well reinforcing our client servicing, offering products like insurance covers us from a professional point of view. A mortgage is a massive commitment, so it protects us considering the duty of care we have to our clients,” he said.

As well as the ALI offering, Mr Wright says that IPS Home Loans has a financial planning division that can explore other options for those clients’ with wider risk needs or those that require a more comprehensive cover.