Insurance: what’s the difference between an advised and non-advised sale? 

Insurance can be useful to help protect both you and your loved ones if the worst happens. 

However, when trying to find the right policy for your circumstances, there’s much to consider, which is where an insurance broker can be helpful. 

If you’re working with a broker to find an insurance policy, you should be clear about whether the sale is advised or non-advised. 

We’ll explore what exactly this means, as well as the pros and cons of advised and non-advised sales. 

Summary  

• An advised sale includes a recommended policy based on your circumstances, while a non-advised sale does not. 

• There are pros and cons to both advised and non-advised sales that you must consider. 

• Unbiased can match you with a broker who can help you with a range of needs, including life insurance, critical illness, or income protection. 

What is an advised sale?  

If you choose to work with an insurance broker, they will look at your circumstances and needs to find the most suitable policy for you. 

They should clearly explain why they have recommended a specific insurance policy and how it meets your needs. This makes it an advised sale. 

A broker or adviser should explain the benefits and risks in detail. 

An advised sale is based on a professional examining your unique circumstances and future goals, using relevant information such as your age, health, and any dependents.  

An insurance broker usually has access to policies from across the market and is not limited in terms of providers. They may also be able to review your existing policies and recommend changes, so you have the right level of coverage, which potentially saves you money. 

Any advised sales must meet higher regulatory standards, and if you’re unhappy, you can seek redress and even take legal action. 

What is a non-advised sale?  

A non-advised sale means that the provider or adviser doesn’t offer any advice – they simply provide you with information about a specific policy.  

For example, if you have an insurance company in mind, the sales team may only have information about the policies they offer. 

While they can answer any questions, clarify features or terms within the policy, and explain the general benefits of insurance, they cannot tell you if a policy is right for your circumstances. 

So, it’s ultimately up to you to decide whether the insurance policy is suitable.  

While non-advised sales must be clear and not misleading, there is less recourse due to the lack of a recommendation. 

So, if the policy is unsuitable, it can be more difficult to get a resolution as it was not recommended or based on any evaluation of the individual’s circumstances. 

How do I know if I’m getting an advised or non-advised sale? 

It should be made clear whether the sale is advised or non-advised, but if you’re unsure, it’s a good idea to ask beforehand.  

The key difference between an advised and a non-advised sale is the personalised recommendation.  

If you want recommendations, make sure you’re using an insurance broker that offers an advised sale.  

For a firm to offer advice, it must have permission from the Financial Conduct Authority (FCA). 

The pros and cons of advised and non-advised sales 

Before seeking out insurance, you should consider the pros and cons of advised and non-advised sales.  

The advantages of an advised sale: 

• It can be useful if you have complex insurance needs. 

• An adviser can help you understand what coverage you need and how much. 

• The policy is tailored to your circumstances and suitable for your needs. 

• You can avoid getting too little or too much coverage. 

• You have more legal recourse than a non-advised sale if the policy is unsuitable. 

The disadvantages of an advised sale: 

• You may have to pay for advice.  

• It’ll take longer to get insurance as it’s based on your circumstances and broker research. 

The advantages of a non-advised sale: 

• If you’re confident in looking for an insurance policy and need one quickly, a non-advised sale may be ideal. 

• You can avoid speaking to someone about your circumstances, which can be uncomfortable for some people. 

The disadvantages of a non-advised sale:  

• You won’t get advice based on your circumstances and needs, so you might choose an unsuitable policy. 

• As the coverage and benefits are not recommended, you could spend more on insurance than you need to (or less, but the policy may not have enough coverage). 

• As non-advised sales have less stringent regulation than advised sales, it’ll be harder to challenge any perceived mis-selling.  

• You may have fewer options than using a broker or adviser, as some insurance providers may only offer information on their own policies. 

• If you don’t check the fine print, there may be restrictions impacting your policy. 

An insurance policy, whether life, critical illness, income protection or another type, can be useful in offering financial support and protection if the unexpected happens. 

Many factors impact your policy and the price you pay, so it’s worth getting advice to choose a suitable policy and protect your loved ones, especially if they depend on you.  

Struggling to find an insurance policy? 

Unbiased can quickly match you with a qualified insurance broker if you want life insurance, income protection or critical illness cover. 

They will examine your unique circumstances and find the most suitable policy.