Stuart Wilson, corporate marketing director, more2life
The effects of the coronavirus crisis have been felt far and wide, with the subsequent lockdown causing significant disruption to everyday life.
For the equity release sector, the crisis has been especially challenging, as the industry was suddenly forced to operate in an entirely remote environment.
The strain of implementing remote working channels in such a relatively short timeframe caused a number of operational pressures for lenders in particular, who in some cases were forced to curtail products and limit higher loan-to-value offerings due to difficulties in obtaining physical valuations.
Lenders have worked hard to overcome these challenges, however, and as lockdown measures have eased we have seen a gradual reintroduction of products and pre-COVID criteria, helping to boost customer choice.
More broadly, the industry’s resilience and focus on keeping business operations as normal as possible have provided customers with the support they need in these difficult times.
In the absence of physical valuations and advice, innovation from providers – in conjunction with the Equity Release Council – has given way to creative solutions allowing lending activity to progress.
It is now common, for example, to see applicants accessing lifetime mortgages via ‘remote only’ processes, which feature video advice and digital document signing.
As a result, many intermediaries have reported that telephone and video-chat based advice have enabled them to unlock additional time, which was previously spent travelling to and from meetings.
Advisers have needed to find alternative ways of remaining in contact with clients and keep their existing business moving forwards.
Before the start of the pandemic, break away from paper-based processes in the equity release sector had been sluggish.
The crisis has led to a significant shift in that approach, with advisers taking full advantage of the tools and resources on offer to improve their remote advice capabilities.
A changing market
Even the most knowledgeable market commentators could not have predicted how the equity release sector would change this year and we are unlikely to completely return to our previous ways of working. In part, this is because borrowers’ motivations have changed.
For many, the decision to opt for equity release is increasingly rooted in practical and essential needs, such as helping loved ones, rather than recreational activities like travelling abroad or making home improvements.
Customers have also changed their approach to their finances as a positive side-effect of the move to remote advice.
With customers now able to conduct conversations about their finances from the comfort of their own homes, many are taking the time to examine their options more carefully and consider how their financial choices can help to improve their short- and long-term circumstances.
Changes like these help to drive the direction of the market, especially where product innovation in concerned.
It is clear that the coronavirus crisis has forced the industry to innovate. From lenders to advisers, we now have new ways of working which, in some cases, are showing themselves to be a significant improvement.
While it is possible that some aspects of the market will return to the old ways as lockdown restrictions continue to be eased, it will be important to remember the lessons from this challenging period.
Remote advice channels are providing customers with flexibility and putting valuable time back into the hands of intermediaries, so we would be wise to continue to embrace technology as a tool which can help to improve efficiency and deliver better outcomes for customers.