Leads generated online should be certified to enable intermediaries to audit and challenge life insurance adverts used to introduce them to potential clients, an industry paper has claimed.

The report, authored by technology platform Contact State and life insurance broker LifeSearch, recommended that certification of every generated lead would also verify a consumer’s journey.

Additionally, it would enable distributors, who repeatedly try to submit clients on risk without certification, to be questioned and prevent lead generators from attempting to sell a lead more than once, according to the authors.

The paper argued that potential customers were “routinely targeted and retargeted with adverts that suggest that life insurance is a cheap, disposable product”.

It added the industry was “involved in one giant game of ‘whack-a-mole’. A misleading advert appears, generates hundreds of leads and then eventually gets shut down after numerous complaints and substantial profit made for the seller”.

Highlighting the significance of inaccurate life insurance advertising, the authors contended that such adverts served as a “collective advert for the whole protection industry”.

The authors also recommended ensuring that lead generation adverts could only run with the backing of the buyer of the lead.

As reported by Financial Adviser, protection advisers have been sharing their concerns over lead generation adverts that used scaremongering tactics to encourage consumers to purchase cover. There were also concerns that such adverts proliferating on social media during April were deliberately misleading people at the height of the coronavirus lockdown.

Dubious tactics

Phil Bray, founder and director at The Yardstick Agency, also warned of “dubious” tactics used by some lead generators that could lead to reputational damage for companies that purchase the leads.

Having seen an increase in lead generation adverts, Naomi Greatorex, managing director at Heath Protection Solutions, said a certification process sounded like a sensible approach, adding that she believed greater control on the type of advertising used for consumers was vital.

She said: “Lots of the adverts used since the pandemic have, in my opinion, been using scare tactics and are inappropriate. These need tighter control.”

According to the proposals, each unique lead would be accompanied by a ‘data certificate’, which would enable organisations that purchase leads to find out which website the client came from, how the website looked at the time, what legal documents and notices the consumer saw, as well as what they consented to.

Dan Thut, operations director at insurance advertising specialist Rocketer, agreed customers’ decisions should be based on “facts, not fear” and described the proposed data certification system as a “significant stride in the right direction”.

The authors of the paper also observed that a number of lead generators, mainly based offshore, had been producing fraudulent advertising, as well as mishandling and reselling consumer insurance data.

Describing the Financial Conduct Authority as “overstretched and focused on serious financial crime”, the authors argued against requiring all lead generation companies that promote and advertise regulated products to become directly authorised by the FCA.


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