Mike Pero Mortgages to branch out into insurance

Listed mortgage broking firm Mike Pero Mortgages is to branch out into the insurance business.

The company today announced plans to set up a national risk insurance business which will operate through some of its 50 franchised offices throughout the country.

Mike Pero Mortgages chief executive Jeff Staniland said he saw the move as a natural extension of its mortgage broking business.

"Mike Pero Mortgages has a duty of care to its clients to make sure they understand the risk and liability associated with a mortgage and take appropriate steps to protect and insure themselves," he said.

Mike Pero Insurances Ltd will provide risk insurance broking for life, income protection and health insurance. Fire and general will also available but will not be not the main focus.

"Sickness or disability is the single biggest risk facing a homeowner with a mortgage," he said.

"Many people are significantly under-insured should they fall ill, or are not able to work for some reason, and could face real problems in meeting mortgage repayments.

"The worst-case scenario is they could lose their house through a mortgagee sale."

Mike Pero Mortgages has five insurance brokers, but until now they have taken only internal referrals from Mike Pero Mortgages brokers.

"Our strategy is to establish the Mike Pero Insurances brand in its own right, and engage or train a number of new insurance brokers to work in a number of Mike Pero Mortgages franchises." Mr Staniland said.

He said the company has a five-year plan, within which time he expects to have about 19 to 20 insurance brokers.

The brokers will source deals from companies such as Sovereign, AMP, Fidelity and AIA.

Chairman George Gould said Mike Pero was trading well ahead of last year in the first quarter to September 30.

The company expected its June 2006 surplus to be "satisfactorily ahead of the last year", and the outlook was positive, he said.

- NZPA