Life offices must improve how they support general financial advisers. Plan Money's Pete Chadborn explains the issues to Fiona Murphy
It's sometimes easy to forget that adviser firms come in all shapes and sizes. This trend has become even more exacerbated in the wake of the Retail Distribution Review (RDR) as firms have had to become more efficient and justify their advice models.
While there are many specialist protection and PMI insurance advisers who read this magazine, most advisers in the UK are general financial planners. They might not be aligned with a network and may only do a few protection cases in a month or even in a year.
Plan Money is one such firm: comprised of six IFAs but with a larger footprint than its small size suggests. About one-quarter of its business is protection sales.
Director Pete Chadborn is one of the most prolific protection intermediaries and commentators on our industry. He feels that financial planning firms, which advise equally on pensions and investment, are somewhat neglected by the protection industry.
The changing advice landscape
The biggest issue, Chadborn says, is how RDR has changed the landscape for advice models and remuneration. He points out the tension in advising on protection, which still pays commission. Meanwhile, other areas of financial planning are paid in fees.
He says: "When you mention RDR, anyone in the protection industry says, ‘That hasn't got anything to do with us.' When it was decided that commission would continue to protection policies, it seemed to me at the time that the protection industry breathed a huge sigh of relief and switched off.
