Kathryn (00:05):

Hi everybody. We are on season seven, episode nine, and today I have Lauren Garrett with us who is from the surviving economic abuse charity to talk about financial abuse in insurance. Hi Lauren.

Lauren (00:17):

Hi Kathryn.

Kathryn (00:19):

We are going to be talking about ways that advisors can potentially spot financial abuse, how we can potentially prevent it, and what we can do if we suspect it is happening. This is the Practical Protection Podcast. So Lauren, how are you doing today?

Lauren (00:41):

I’m very well, thank you. Really pleased to be here.

Kathryn (00:43):

It’s lovely to have you with us and it’s really nice On the podcast we kind of alternate the episode. There’s usually one episode that we go like a deep dive into what’s known as the risks in terms of the insurance space, and then the next one is more like an industry commentary or things that we are seeing and things that are emerging. And I know that you’ll be very aware of this as well, but I’m sure that all the advisors listening, we’re very aware of the consumer duty that’s coming towards us all and there’s so many aspects to consumer duty, huge area in terms of vulnerability. And I do training in the vulnerability side of things, but I think it’s one of those things as well where you just never really know are you capturing everything? Are you really identifying all those different vulnerabilities there?

(01:24):

What can we be doing? And I think speaking to you and about the charity that you are with and what you are doing is a really, really great insight and first step for advisors to start putting processes in place, companies even to be putting processes in place. And maybe dare I say it, because I do come from a compliance background, maybe some compliance people or some compliance processes may be having to change slightly to accommodate what we’re seeing and what needs to happen in terms of financial abuse so that we can make better outcomes for everybody. So I think it’s really good from the start if it’s okay with you. So just tell us about the SEA Charity and why it was established.

Lauren (02:00):

Yeah, absolutely. We are surviving economic abuse. You’ll hear me refer to us as sea, which is so I have an economic abuse for sure, and we are the only UK charity dedicated to raising awareness of economic abuse and transforming responses to it. So as C was founded back in 2017, we are relatively new by Dr. Nicola Sharp, Jeffs our CEO. And Nicola is an expert in economic abuse as it occurs within the context of coercive control. And she’s worked in the violence against women and girls sector, so the Vogue sector since 2006 in both policy influencing and research roles. And it was actually back in 2016 that Nicola was made a Churchill fellow and she traveled to America and Australia to explore innovative responses to economic abuse. And it was actually her determination to ensure that women in the UK have the same access to responses in the US and in Australia that led her to establish SEA back in 2017. So like I say, we are relatively new, but we’re also quite a small charity and we’ve had quite a huge impact over the past six years. So namely our success in getting economic abuse recognized as a form of domestic abuse in the domestic abuse Act 2021. And that also included a change to the Serious Crime Act so that coercive and controlling behavior applies.

(03:43):

And that came into force just a few weeks ago. You might have seen brilliant some news reports on it. So that was really, really great because we know at sea that post-separation can be a really dangerous time for victim survivors. It’s when they are most likely to experience homicide, but sadly, economic abuse can also start. So the behaviors and the tactics can happen once a relationship has broken down. And so this was such an incredible outcome for survivors. We’re so pleased that it’s now being recognized as a form of domestic abuse in the statutory definition because it validates so many victim survivors experiences. And our mission at SEA is to create a world in which all women and girls achieve economic equality and can live their lives free of abuse and exploitation. And we do that by working in partnership with frontline organizations that directly support victim survivors of economic abuse.

(04:46):

So we are a second tier charity, which means we don’t work directly with victim survivors, but we work in partnership with Money Advice Plus, and they run the financial support line which support victim survivors who are in debt. And yeah, just give you a bit of an overview, we work in four key ways. So the first is to raise public awareness of what economic abuse is and transform understanding and responses. We also work with women’s sector professionals to help them understand and respond to economic abuse. And we drive improvements across the financial services sector, which will be key to your listeners. Absolutely. And the ways in which they support victim survivors. We also work with decision makers for changes in legislation, as I just mentioned, policy and regulation. And again, that’s within the financial services sector and the women’s sector. So quite a broad remit there.

(05:47):

And then lastly, but in my personal opinion, most importantly, we are survivor centered at sea. So everything we do is because victim survivors tell us that these are the issues that they are facing. So we don’t just run with an issue that we think is important, it’s because we’ve been told by a victim survivor and we run a group called the EEG, which is our expert by experience group. It’s made up of over a hundred women who inform all of our work and our policies. So it’s really, really important. And although at sea our work is focused on women, we recognize that economic abuse can happen to anybody. Yes. Yeah. And I don’t know if you wanted me to tell your listeners a little bit about what economic abuse is and how it’s different perhaps from financial abuse, if that’s helpful. I

Kathryn (06:41):

Think that’d be really helpful as well. I think it’s quite good as well to bring in at this point because I think obviously everything you’ve said is so relevant, so important, especially in the insurance space. But I do think sometimes some advisors might listen and think, but how does this actually apply to me as an advisor? How am I going to identify this? When we hear things like coercive abuse, it’s incredibly strong words and it’s meant to be obviously strong words. It’s a very significant thing. But I think some people could think, oh, no, no, I’m not specialist in that. And I think the whole point of this episode and other things as well is that we’re not specialists. We’re certainly not you guys. We’re not the people who are absolutely at the frontline dealing with these things, but we can definitely take steps and there are definitely challenges to our industry to make sure that we are going to be better for people, so for the advisors that are listening.

(07:27):

So it’s things like we will talk about at some point, like the joint life insurance policies, separation clauses that could be there, trusts trust is a really big one. And with you saying there about that, a lot of this can happen, that is really where we’re stepping in as advisors when these things happen, what can we potentially do? So we’ll talk about that a little bit later on as to what we can do from what I’ve experienced and what I can share with people as to at least some of the steps that people can take. But yeah, absolutely. What is the difference between economic abuse and financial abuse, please?

Lauren (07:58):

Yeah, yeah, exactly. And I think what you’ve said there about advisors perhaps not seeing this and that frequently can make it difficult to detect. And I think certainly for a victim survivor, they may not even realize themselves that they’re experiencing a form of economic abuse or financial control until after the fact. So it can be really difficult and we will talk about some of the signs that people can look out for, but it can be really tricky. And so yeah, when thinking about the differences between financial abuse and economic abuse, at C we use the term economic abuse because we believe it encapsulates a broader range of perpetrator tactics. So financial abuse might be controlling somebody’s access to their bank account and access to money, whereas economic abuse refers to controlling the things that money can buy. So that might be clothing, food, heating, transport.

(09:00):

And so economic abuse is much broader. And there are three main ways that a perpetrator can carry out economic abuse. And we speak about these through restriction, exploitation, and sabotage. So examples of those restriction might be restricting how a victim survivor uses money, what they spend money on, giving them an allowance, checking receipts, dictating what somebody can buy, restricting use of a car or a vehicle. So perhaps there might be a car sitting outside on the drive, but making them walk to work, walk the kids to school, which might make them late for work. So forms of control and exploitation might be stealing somebody’s money or property, it might be breaking or damaging property. So that then has to be replaced or perhaps repeated claims have to be made for damaged property. It might be building up debt in a victim survivor’s name, which is something we see quite frequently in the banking space that might be without their knowledge, or it might be through manipulation and coercion and it could be refusing to contribute to household costs or for a mortgage.

(10:14):

And then finally, there’s sabotage. And again, this is really broad, so it might be preventing a victim survivor from going to work, or it might be limiting the number of hours they can spend at work or making them work two jobs, so they’re constantly exhausted and fatigued all of the time. It really boils down to things like controlling how much an individual can eat when they’re allowed to boil the kettle, how much water they can have, how many hours of sleep they get at night. And as you can imagine, all of this then bleeds into that individual’s ability to earn a living to better themselves, to get promotion, to become educated further their careers and just feel well. And that’s how economic abuse can be quite insidious and bleeds into all sort of other forms of domestic abuse. Apologies. So yeah, we recognize that economic abuse and financial abuse involve very similar behaviors, but we think it’s quite helpful to think of financial abuse as a subcategory of economic abuse. So yeah, I dunno if that’s helpful as an overview. It is. It’s

Kathryn (11:25):

Really helpful. And I think those examples that you’re giving there are really important. And I think another thing, obviously as an advisor, we are generally, we’re not usually in the person’s house, so sometimes some advisors can be, depending upon the way that they’re set up, they might go to visit their clients and different things like that. But I think what’s quite interesting is to just for everybody to be very aware from what you’ve said is that when people are doing this, they’re incredibly smart I imagine, about the way that they do it. So you might think, well, I’ve spoken to hundreds of clients and this has never been anything, but ultimately you won’t know. It will be something like you say that’s very hidden. There’s people I’m familiar with, people myself who I could very easily see that there was things like this happening as well as other forms of abuse and they can’t see it themselves. So it’s a very, very hard thing. So I think that’s really, really useful. In terms of this, I know you’ve mentioned that you are focused particularly on women, but that you do obviously identify that it isn’t just women that would be potentially victims of this, but who is there a specific, I’m trying to think is a specific category of people who would typically be most at risk of financial abuse?

Lauren (12:37):

Yeah, no, I think that that’s

Kathryn (12:39):

Economic abuse. Sorry I’ve said financial abuse.

Lauren (12:41):

No, no, it’s fine. And often people use the terms interchangeably and it might be that actually what you see in your work is financial abuse because that’s more relevant to your advisors, but there isn’t a set demographic really to answer your question in short terms, really the nature of economic abuse is intimate and personal, and as a result of that, it means that it can happen to anybody at any time. So yeah, there’s no sort of one demographic that fits the mold. And our research tells us that economic abuse is happening at equal rates across all socioeconomic backgrounds. For instance, there’s no evidence to suggest that poorer households experience more forms of economic abuse. That said, we do know that women who are unable to access a hundred pounds of short notice are more likely to experience a form of domestic abuse, but there’s nothing to suggest that, like I say, poorer households experience economic abuse that anybody, we’ve heard stories of women in really senior roles or in financial services who’ve experienced form of economic abuse.

(14:07):

So yeah, it can be anyone. We do know, however that the conceptualizing and understanding of economic abuse between men and women can differ, and particularly when we’re thinking about economic abuse within the context of coercive control. So research actually tells us that men and women experience economic abuse at equal rates. However, women are more likely to experience economic abuse alongside other forms of abusive behavior. So emotional abuse, psychological abuse, physical abuse, sexual abuse, and it’s more likely to be prolonged over several, so the impact loss a lot longer. Whereas men tend to recover financially within 12 months of the incident and they report it being more one incident of perhaps financial abuse and that could be a friend or family member who carries out that abuse. So it’s not always an intimate partner, but there are life stages where people perhaps are more vulnerable to experiencing economic abuse.

(15:20):

So particularly for women pregnancy and becoming a parent, it’s a time where they might be more susceptible to experiencing a form of economic abuse or perhaps when somebody moves in with a partner and all of their finances become joint, that that could be a high risk time. But elderly people can also experience economic abuse. And interestingly, elderly people are more likely to not recognize or to self-identify that they’re experienced in a form of economic abuse. So when asked outright, they’ll say, no, I haven’t experienced this. However, when asked probing questions, their answers indicate that they have and are experienced in a form of economic abuse, which is really sad. And then obviously there are other vulnerable groups and minority groups such as migrant women who may be more likely to experience in forms of economic abuse because of intersectional vulnerabilities. So yeah, I hope that answers your question. But yeah, much, much just anyone and

Kathryn (16:26):

Everyone, anyone and everyone. And I think it’s really important what you say there as well is to not assume that if there’s a poor household that that’s much more likely, sorry, a poor household, so much more likely than someone who’s coming from a rich. And so straightaway I’m thinking I don’t want to go into stereotypes. In some ways I’m thinking there’s a couple, there’s a family, they’ve got kids, the husbands is carried on working, the woman has stayed at home with the kids, he’s suddenly earning loads and loads of money. She’s not because she’s looking after the children. And you start to get that disparity and it wouldn’t be too tricky I imagine for that to become a bit of a slippery slope at times as well. Imagine it isn’t something that necessarily just boom, it happens.

Lauren (17:10):

No, absolutely quite gradual. It builds up gradually over time. And then there’s that sort of loss of control again, loss of control, but I guess alongside loss of self-esteem and perhaps that gaslighting not having the confidence or not realizing that the behaviors aren’t normal or this isn’t quite right, it might be that the partner says it’s really caring and you’ll look after the kids and I’ll take care of the money and the finances. Don’t you worry, you’ve got a lot going on. And that’s how it builds up over time to the point where perhaps then online passwords have been changed and they can’t access the account and they don’t know. This might lose touch with how the finances work and things like that. And I mean, again, that’s perhaps a stereotypical story, but that is certainly some people’s lived experience and that is what we hear that is happening. And there was some research conducted by the Aviva Foundation at the beginning of this year actually, where the 3000 adults in the UK were asked to complete a survey and two in five of those had experienced a form of economic abuse. So it’s really prevalent within the uk.

Kathryn (18:30):

Right, okay. So obviously we’ve mentioned before that a lot of our listeners are going to be from an insurance background, lots of advisors, but we are talking people who are also from pensions and investments, mortgages, all of that kind of space as well. So what are the kind of common things from a finance side of things? As an advisor we would be doing a fact find with a client, so we would find out some personal generic information about people we would need to ask about certain amounts of finances and things like that. But is there anything that common that we should be looking out for to just make us think? Maybe I just want to have a bit of an extra look at this.

Lauren (19:06):

Yeah, yeah, absolutely. And I think this is a really great question. As I mentioned previously, economic abuse can be really difficult to detect. And even when you might have concerns, it can be really difficult to perhaps start that conversation and to get somebody to disclose because they may not realize that it’s happening themselves. So it can be really tough, but there are some things to look out for and I think in particular around the products that are being offered and the sorts of things that might be happening that might raise alarm bells or make you think something doesn’t feel quite right. So for instance, when speaking to customers, are they aware of certain products in their name? Do they know what’s happening on their accounts? Are they looking to perhaps draw down on a pension or an investment without a clear reason or rationale? It might feel a bit odd to do that at that particular time.

(20:07):

They might appear quite desperate to have access to funds. And why is that? It might be that they have a joint mortgage that only one party pays into that they’re paying on their own or perhaps that the joint mortgage holder is deliberately withholding payments and forcing the account into arrears, which is something we see quite commonly. And something again, which we’re seeing quite commonly as a result of the cost of living crisis is a joint account holder perhaps refusing to move a mortgage onto a better rate if the interest rate has changed and increased or moved onto a standard variable, which is increasing the monthly payments, forcing perhaps the victim survivor into financial difficulties, meaning that they then go into arrears. So that might be a sign, and it might not be that the customer says explicitly that this is happening, but you might see that or it might not make sense as to why won’t the joint account holder agree to sign the contract to move you on to a better rate?

(21:08):

And that might raise concerns. It might also be that a policy has been canceled and that could be for important health insurance or for car insurance, and the individual wasn’t aware of it, they might ring up quite frantic. Why was the policy canceled? That would definitely be an alarm bell if a joint policy holder had done that, or as I mentioned earlier, it could be that there’s been excessive claims for a property in relation to damage. If a particular household item keeps being reported, that might flag concerns depending on the circumstances and the nature of what’s happening because of course that could lead to the insurance policy being canceled, leaving that individual uninsured or a claim being rejected or perhaps higher premiums. So just things to be aware of. And it might also be in something that we’ve already touched upon and are going to touch upon a bit later, but thinking about joint life insurance products and it might be that the one party is trying to cancel the policy and the other party is refusing to consent or something like that again, which would raise alarm bells I guess.

(22:30):

And then just thinking more broadly, there are some more subtle things in terms of communication with customers that might be concerning. So do they appear withdrawn, frightened, scared, distressed? It might be that the way that they talk over the phone, they’re whispering, perhaps they might appear afraid that somebody’s listening in or it might be that they’re actually taking instructions from somebody else. And that’s something we hear quite commonly from financial services, that there’s concerns that somebody’s actually guiding that conversation and telling them what to say, which can be concerning. It might be that they’re contacting you really frequently and that could be a concern or perhaps that they are contacting you frequently and then they stop. So it is like a pattern of behaviors that is unusual based on the conduct of that account that might flag concerns. They might have concerns around access to their account, privacy, safety, that sort of thing. Or they might tell you that they’re no longer receiving post, they haven’t received any documents. Why is that? Is their post being intercepted things to really look out for or that an individual is deliberately making mistakes or spoiling applications and things like that because they don’t want them to go ahead, they actually don’t want the product that they’re being forced to do. So

(23:53):

Yeah, like I say, it is really a pattern of behaviors that might give cause to concern and these things on their own might not be an issue, but it’s where you see them happening across somebody’s account and you think something doesn’t feel quite right and that might indicate that there is economic abuse happening.

Kathryn (24:10):

Absolutely, and I think from an advisor point of view, just for advisors listening in terms of some tips I can maybe give is that if you’re speaking to somebody’s come to you, the part of a couple, and they’re wanting to set up let’s say life insurance, critical illness cover, okay, well that’s okay in a sense, but make sure that you’re speaking to both parties. Does the other person know what’s being set up? It doesn’t necessarily have to be a hugely long conversation, but at some point you want to speak to that person, are they aware? Do they know what’s being set up? Do they understand about it? And I think what’s really important with this as well is that with most insurances in the UK and the protection space where I operate in, you have to put in a contact number and contact email address and that would be per person.

(24:56):

So it’s not a case of don’t copy and paste one person’s details into both. It is very much a case of, no, I need that person’s contact details. We need to be in touch with them. So there’s definitely things like that that we can do from the start. And I said we will talk a bit more on the joint side of things as well, but it’s doing that, it’s like you said as well, if there’s suddenly a change, if you know your client and working as an advisor, you are meant to know your client if there’s a certain change, what’s going on. Another one will be somebody coming along and saying, oh, well I want to arrange insurance on my partner, and you don’t actually. So my partner doesn’t, they’re really busy and this case, okay, well I can give you the quotes, but it’s not happening unless I speak to them.

(25:38):

And I think sometimes obviously some advisors are in such a high pressure environment that they are just being pushed, pushed, pushed and they might not through a fault of their own and not because they’re doing anything specifically wrong, but they might just be just so much pressure that this is just another thing that they maybe forget to spot. And I think that is what’s really important is that this is too important not to spot. And so when it comes to those high pressure environments, especially there needs to be compliance support there at some point to put in some kind of flags to make sure that if anything like that is being happened, well have we done all the vulnerability checks that need to happen here? Because an advisor advisor might think, well, how am I meant to do that? It doesn’t take too much to put a flag in the computer system to say this has been set up on what’s known as a life of another basis, so I’m ensuring someone else’s life. And for then compliance to just have a quick look and go, this been done, what is this here? Has there been contact with this other person for them to feel comfortable about this?

Lauren (26:37):

Yeah, so reassuring to hear you say that. Yeah,

Kathryn (26:41):

Well there’s so much I say I’ve come originally from a compliance background and then into the advisor space, so I’m constantly looking for anything like that as to what we can do. I’d said I’m very lucky though we do have a dedicated IT person who can just make these changes for me instantly for anything we think. So I do appreciate it’s not as quick as it necessarily can be for other firms. Okay. Are there any specific techniques or approaches that you think advisors can, obviously, I know I’ve just said that one there, but started saying that’s actually it’s making sure that compliance and that advisors are really working together on something like this. Is there anything else that you think if you were to come in and say, train me and my team and go, right, if you have this situation as you say, how do you approach it? If you start to suspect something? Do we need to alert people? What do we need to do?

Lauren (27:30):

And again, that can be quite a difficult one because you might, I might feel that there is something happening and you might detect something that feels quite unusual behavior, but then in asking gentle probing questions and letting the customer know that you’ve identified something doesn’t feel quite right, there could be the possibility of them putting that individual at further risk of harm. So it’s really important to think really carefully about the steps that you take. So I would certainly say have a conversation with your customer to let them know that you have identified something, but not to say, oh, you experience in economic abuse, we wouldn’t recommend that you ever said something that explicit, but just asking is everything okay?

(28:34):

That might seem like a really obvious thing to do. But like you say, people are working in high pressured environments, so having these sort of human conversations can sometimes maybe be tick box or we don’t have them at all. And actually in recognizing that perhaps somebody’s struggling and asking that question, it can give somebody an opportunity to disclose if they feel comfortable to. But I guess it’s also letting them know that as a financial service provider, you do also work with different organizations and charities perhaps that can offer support, which gives somebody perhaps an opportunity to open up because it’s interesting, isn’t it? You think that why would a customer tell me an advisor this? Why would they disclose to me? But actually in fact, the very research that Aveva carried out at all, the Aveva Foundation carried out at the beginning of this year.

(29:32):

It reaffirmed research that we’ve already done at sea that outside of friends and family, victim survivors are more likely to disclose to a financial service provider than they are to the police or a domestic abuse service. So actually it’s having those conversations means that that individual might open up to you because you are not the police. And so there aren’t perhaps going to be repercussions to doing that and things like that, but they might be able to get the financial support that they need, hence they’re more likely to disclose. And then that gives financial services such a unique opportunity to then signposts and get that individual into the services that can support them when they’re ready, when the time is right. Don’t think that having those conversations means that you’re overstepping the mark, let’s say. But also don’t think that you have to be specialized in domestic abuse or economic abuse in order to have that conversation and hold that space don’t.

(30:35):

One of the most common things that we hear from our expert by experience group is that a call handler an advisor, somebody within financial services that’s taken the time to listen and believe them is the most important thing that can happen aside from financial relief and debt write off and whatever it may be, just holding that space for somebody. So really, really important just to listen and validate their experiences because that can be so powerful. And I guess not giving a computer says no response or we can’t help because that’s not helpful. And that instantly puts the backup of the person that you’re speaking to and makes them feel that they can’t disclose any further because you can’t support them. So even if the computer does say no, maybe think about what can be done differently. Can you escalate it internally? Can you go and speak to a champion or an advisor or a senior person where the process might be able to be changed or there might be flexibility because we know that that can happen and that does happen.

(31:50):

Never ask a victim survivor to contact the joint account holder if they disclose economic abuse because, well, for obvious reasons that might put them at risk. It just isn’t the right thing to do. And remember that you might do these things and you might have a really open conversation and then the victim survivor or the customer may not disclose. They might just say, okay, thank you, and don’t feel downtrodden by that because like I’ve mentioned before, they might not even realize it’s happening themselves. And I always say that every interaction is an intervention. And so just letting them know that you’ve noticed something and that you’re there to support them, that’s all you need to do. And then the next time you speak to them, do the same thing again and the same thing again. And make sure they know where to access support. And even if they don’t disclose, if there is flexibility around processes that you can put in place, if you can give breathing space, if you can provide extra support and signpost in, do it, you don’t have to signpost them to domestic abuse charity.

(32:57):

I would definitely say that that could be risky, particularly if that information were to be accessed by an abuser. So be really careful what you put in writing, but if you’re giving really general information about support services and vulnerability and things like that, you could embed something about domestic abuse and economic abuse within that. And I would definitely advise doing that so that when the time is right, that individual is empowered to get the support that they need and they know that they can come to you. And I think that’s really, really important. Yeah, and we’ve seen so many things happening within financial services in terms of the support that is being offered. It might be referring somebody to a specialist support team who is actually trained and has more time and flexibility to offer that support. We would definitely recommend that having information on your website about where they can access support really key so that if they want to disclose they know how to.

(34:06):

And yeah, just making sure as well that you look after yourself. If you suspect things like this, speak to somebody about it, speak to a colleague, don’t jump straight in and take action. That might not be the right action to take. Speak to a charity, come speak to us if you’re unsure. And also if you have a designated safeguarding lead, really, really important that you speak to them about any action that you take because it might not always be right to make a safeguarding referral or to contact the police or to contact the local authority that could put that individual at risk of harm, particularly when you are not sure what’s going on. That might be really tricky if the police, let’s say, turned up at their front door and the perpetrator was there. So it’s just thinking really holistically about what you might be able to do. Yeah, I dunno if that’s helpful at all. It’s

Kathryn (34:57):

Really helpful. And I think for advisors, in terms of the practical side of it as to what you can do, I think some really important things you said there, but ultimately if you are an advisor, nobody’s expecting someone who’s trained significantly over the years in mortgages or pensions, investment, anything like that, protection insurance to also be an expert in this kind of thing. And like you say, signposting is so important, but if you’re speaking to someone and you’re suspicious you’re not sure about the activity, what’s being going on that in a way just turn and say, right, okay, look, basically I can do this, thank you. We can chat about this kind of thing, but what I do need to do is just because of the nature of this, I need to get some compliance oversight and just in a sense just use that kind of, I needed to just get some compliance oversight, maybe something like that.

(35:43):

It might just give you those couple of words, just might be and just say it’s a standard process for this type for what’s happening, standard processes your firm, you need compliance just to give the thumbs up on it. You don’t need to make it a big thing. It then gives you a bit of breathing space Absolutely. To make sure that okay, what’s going on? Do then speak like you said to the safeguarding person, to your compliance people, find out what’s needed. And in terms of those things that you are, like we said about sending out some information about maybe domestic abuse or economic abuse, sends out a bit, maybe develop a bit of a document as a firm and just go say, right, this is something that we send out to all of our clients as standard. Exactly. Right. So in it, let’s start at the top.

(36:23):

Mental health support services, you can access them here, dah, dah, dah. There’s also this regulatory body in the UK who can really help if you were to ever find yourself in a position of death, there’s also and just doing this, have it in amongst it all. And then like you say, the problem is it wouldn’t be hard for someone to intercept posts or intercept email, anything like that. So you really don’t want to be putting it too specifically written down because it could just put that person in danger. And I’m sure that anybody taking that kind of action would have the absolute best interest at heart. But I think as well, from an advisor point of view, and I’m saying all of this, this does come down to the firm as well. So advisors are one thing and they are the front line, but it’s the firm, it’s the compliance team that needs to build this.

(37:05):

So it isn’t just an advisor’s responsibility, they are incredibly responsible, but they have to have that backing from the firm. And I always say this as well, whenever I teach about vulnerabilities and things like that, it’s really important. We are talking about incredibly vulnerable situations here. And potentially you might, even as an advisor, I sometimes hear things incredibly sad and situations that are horrible, there needs to be steps in place to protect yourself as an advisor. The firms need to make sure that if an advisor has just spoken to someone and they suspect something, nobody knows what that individual advisor’s been through, they might have experienced that themselves. That might be why they’re spotting it so well. They need that support. This could be very triggering for the advisor. And it’s just really the responsibility of firms to put their advisors and the clients really at the heart of what they’re doing.

Lauren (37:57):

Yeah, I mean I could not agree more. You can’t support the customer if you are not supported yourself. And that’s so important, particularly what you’re saying around being triggered and identifying these things because you have that empathy perhaps because it’s something you’ve experienced or something a friend or family member has experienced. And that’s so important. And so often we will speak to firms who are looking to develop a policy for customers but don’t have a policy for colleagues. And it’s really, really important that you do both simultaneously. And that support provided to customers is also provided to colleagues. And we’re seeing such amazing things happening in this space where firms are really sort of going above and beyond offering customers and colleagues, things like emergency flea funds, which is incredible, setting up safe spaces in branches and things like that. But yeah, just ensuring that extends both ways I guess is really, really important because we’re not talking about them and us. We’re talking about everybody because anybody can experience this.

Kathryn (39:07):

Yeah, absolutely. In terms of the insurance, then the insurance side of things, because obviously a big area that I’m from, so I know we’re going to be talking about some paper that’s been missing recently that you have had, and I think it’s coming out soon and it’s been one earlier this year, but it’s essentially, it’s quite hard for us as advisors, and I mentioned this earlier because our regulators, our compliance people will say to us, if there’s a joint mortgage, you will be doing joint life insurance because if not, you’re doubling insuring it. That means that your people are paying more from what they need to pay for lots and lots of things. And you can find the compliance teams will really tell an advisor off. They’ll say that they’ve missed advised, they’ll make them redo the cover, they’ll withhold their payment for their work at times because of the facts of something like this.

(39:52):

And the difficulty is, and nobody goes into setting joint mortgages or marriage or insurances thinking at some point we’re going to split up. Nobody does that as well as I’m aware. But it does happen and it happens a lot. And the difficulty we have is that for some reason, I dunno why, but not all insurers offer separation chances for these policies, which then means that sometimes you’re left with a policy that both people are paying into where actually they really need to not be in communication with each other anymore. There’s probably real safety issues and they need to be completely apart. And then somebody’s then having to go, right, well actually I’m going to completely set up this new policy for myself so the money would go to the people that it needs to go to rather than this X person. But then there’s still a joint policy that’s on their life that the other person’s going to benefit from, which is a really, really not okay situation.

(40:50):

And then we’ve got the fact of trusts, the trust or legal document that will basically put in place with an insurance to say, right, if something happens to us, it’s going to pay to this person. Now some insurers make it easier to change their kind of documents so you can change, well actually my circumstances have changed. I wanted to pay to this person now. But many of them still require a signature of the original person to say, yeah, I’m fine to not receive this money anymore. And as you say, in terms of economic abuse, that is not going to happen. So essentially what ends up happening is the person has to cancel the policy, set up a new one. Their health may have changed, lots of different things could have changed. They will be older. So no matter what, it’s going to be more expensive because they’re old.

(41:29):

But if the health has changed, it could be phenomenally more expensive. So I do think there’s a really, really big call in our industry for insurers to make the trust documents much more flexible in terms going forward. And that’s not something that advisors can do, that has to come from the insurers and from their legal departments as to what they do in terms of the trusts. It’s giving the opportunity to split a policy into two that should just really be a standard. But what are we looking at? I know there are calls in our industry, I know we’re going to talk about this about something that you’ve got to share with us, but there are definite calls in our industry aren’t there to not do joint life insurance, post joint critical illness policies and to make sure that we’re doing singles. And that’s really, really hard because we can see that the economic abuse charities can see that, but our compliance, our regulators saying, no, you shouldn’t do that. So what are the arguments for this?

Lauren (42:22):

Yeah, it’s a complex issue for sure. And something that we have done a bit of work around at surviving economic abuse and as I mentioned, we published a briefing paper about insurance and economic abuse at the beginning of this year, which perhaps we can pop a link in the show notes or something like that for people to have a look at that because it highlights all of the issues around insurance from data protection issues to multiple claims to life insurance. And it was really the life insurance and joint policy issues that highlighted in that document, the need for reform and the need for a change. And so we have been working with Johnny Timson and Professor Jim Davis at the University of Bristol to create another briefing paper which focuses specifically on life insurance and economic abuse. And it really gets into the sort of legalities of this and why policies can’t be split. And there certainly needs to be legal reform in order for this to happen. And the issues that the paper addresses include life insurance policies being taken out without the policy holder’s consent or knowledge as you just mentioned. But those policies then being used as a mechanism to threaten and control the individual.

(44:04):

And you perhaps can’t even believe that it happens. When I was reading the paper and some of the examples that have been in the media are where this has happened, perpetrators actually threatening to take a victim survivor’s life to gain financially from a life insurance policy. It’s absolutely terrifying. We know from we sit on the domestic homicide review panel and we know that this happens when there has been a homicide, there are cases where perpetrators have taken out multiple policies against somebody’s life in order to gain from them financially. And there’s been some high profile media reports about this and it’s really quite chilling and awful and there’s details about that in the paper. And then there’s the issue of joint life insurance policies and then being unable to be split upon separation. And that’s a real issue because you mentioned about when people take out these policies, they’re don’t expect that they’re going to separate and things like that.

(45:09):

But actually in the uk, 30% of marriages end in divorce. So that’s quite a large number. And we’re not always talking about scenarios that relate to domestic abuse or economic abuse. Relationships end and people separate and there needs to be an easy way for people to get out of these policies without there being all of the issues, Kathryn, that you’ve just mentioned. And so we, in the paper that Johnny and Jim have offered, we’ve called for there to be a mechanism in place for policies to be split in the absence of the legal reform that I’ve mentioned because we know that clauses are permitting, the division of policies exist, but not all firms are using them. And including such clauses is likely to make the policies more expensive and it might change the level of risk for the insurer, which can be tricky, but we don’t believe that that’s a reason not to do it. And so we think there has to be some mechanism in place because it feels quite antiquated that there isn’t and that there are victim survivors particularly have to jump through such hoops in order to make this happen. So the paper does call for insurers to consider single life policies as a default.

(46:39):

And it does suggest in some scenarios for those to be placed in trust where appropriate with a minimum of free appointed trustees. But it also proposes that trustees should be made aware of their duties, so as part of that compliance, and that should include economic abuse awareness so that they’re actually getting that knowledge from the start. So yeah, we’ve had insights from our expert by experience group about this, some scenarios where victim survivors have been asked to contact the abuser for their consent or where the insurer has offered to do that on their behalf, which again, not the right thing to do. And I did actually have an example of a case study where the victim survivor contacted her insurer to cancel a joint policy that had been taken out many years ago with the perpetrator and she was told that it couldn’t be canceled without the perpetrator’s consent.

(47:43):

And she explained that she wasn’t able to contact them because of domestic abuse, but they explained that because he was a joint policy holder and had legal interest in the policy couldn’t be canceled. There’s nothing they could do without his knowledge or consent. And so it kind of went round and round in circles. But what actually happened is that they did agree to, they were able to cancel the policy. He did agree, but then he would ring up and reinstate it. So it was just going round and round in circles and canceling reinstating and canceling, reinstating,

Kathryn (48:24):

Prolonging that control.

Lauren (48:27):

And that’s exactly it. It’s a tactic in order to maintain that control. And that’s really at the heart of what this is. What was suggested is that the victim survivor could contact a solicitor, get solicitor involved, which just feels really excessive or they could cancel the direct debit. And it feels like that’s really the only option here, that if the direct debit is canceled, then the policy will lapse. But again,

Kathryn (49:02):

I was assuming that the victim is the one that had the academics. If it was the one who’s obviously been the abuser, if they have it, then you say they can just keep it going.

Lauren (49:12):

So I mean obviously we were aware of what the issues are and the paper that we published in January and the paper that we’re about to publish calls for there to be more training awareness raising for there to perhaps be a specific guidance or policy note specifically for insurers around what to do around these issues. Because there is flexibility, causes can be put into terms and conditions and things like that, but it’s at the risk appetite, I guess, of the insurer.

Kathryn (49:44):

Yeah, well as you say though, 30% of marriages end, so let’s just say on average of our customers, a third of the insurer’s customers on those joint policies, there’s going to need to be a change at some point.

Lauren (49:56):

Absolutely.

Kathryn (49:57):

So I think assuming the amount that is actually written insurance wise, I would assume that that is a significant portion of people and I appreciate it can be difficult for insurers if it’s a joint policy, the insurers just taking out the risk of paying out the policy once, whereas if we separate then it’s potentially risk of paying out twice. But as you say, that’s not a reason not to do it. There are ways that that can be changed and whether or not the people then have to pay a bit more to make it seem more that it’s a single policy. I think probably quite a lot of people in this situation would just want that opportunity for that to end regardless of like any of the other changes that might need to happen.

Lauren (50:36):

Yeah, absolutely. Because it’s products like these that then, as you’ve mentioned, they inadvertently facilitate the abuse and allow the abuse to continue for a prolonged amount of time years after the victim survivor may have fled that situation. And it’s just a reminder, a constant reminder that the perpetrator is in control and they should be given that economic safety and should be able to regain control of their finances and the financial service provider and the insurers should be supporting them with that, not putting barriers in the way. And of course we know that that’s not deliberate and that there are real complications around this issue, but it is definitely time for it to be looked at and for a change to be made.

Kathryn (51:22):

It is. And I think that’s a really important thing in terms of society as a whole. We always need to get better in a sense as to what’s happening and businesses need to adapt with the change in society. And I imagine that a lot of these clauses that our aren’t in there are back from the days when divorce wasn’t necessarily allowed in

Lauren (51:42):

A sense. Yeah, exactly.

Kathryn (51:43):

Whereas now there is a lot more empowerment and people are able to make these decisions, they are able to divorce, and I think it’s an incredible thing that your charity’s doing and to make these calls and these changes as well. And I think that can only be to the betterment of clients. And obviously I’m sure many, many advisors will be very happy to be able to see that these changes are happening. Is there anything that you would like to leave us with in terms of thoughts as we just come to the end of the podcast?

Lauren (52:12):

Nothing specific actually, but I would really love for you all to have a look at our briefing papers that we’ve published. We’ve been busy this year, so we’ve got the insurance briefing papers, but we’ve also published something specific relating to the consumer duty and how the consumer duty really gives firms an opportunity to transform their responses to economic abuse. So that might be some good food for thought for advisors to take a look at as well as the life insurance paper that I’ve just mentioned that we’re going to be publishing soon. And if anybody listening wants to find out more about our work, wants to get in touch with me, please feel free to reach out to us. We’re always happy to support. We offer training consultancy if you needed support in developing a policy or whatever that may be. And really, really happy to speak to people, and I hope that people have found this podcast interesting, have learned something new. And like I say, there’s plenty of resources on our website including a checklist for insurers, which again, your listeners might find quite interesting to take a look at.

Kathryn (53:24):

Yeah, absolutely. Thank you so much. Well, thank you for joining me, Lauren, and for all of those really, really helpful insights. Next time I’m going to be back with Matt Ran and we’ll be talking about lung cancer and insurance. If you’d like a reminder of the next episode, please drop me a message on social media or visit the website, practical hyphen protection.co uk. And if you’ve listened to this as part of your work, please do remember to claim your CPD certificate on the website too. Thanks to our sponsors, the Okta members. Thank you, Lauren. Thanks so much.