'Steady flow' of advisers leaving the market

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Nearly 2,000 advisers de-registered at the beginning of 2013 while those who remain are focusing on wealthier clients, research has found.

Market intelligence provider Equifax Touchstone said it was "crucial" for providers to understand the needs of those still writing business, in order to deliver suitable objectives for long-term growth.

The research found 2012's quarter 4 saw nearly 5,000 intermediaries de-register while more than 2,000 de-registered in 2013's first quarter.

While fewer advisers had left the market in recent months, there was still a steady flow of intermediaries exiting the market, the research highlighted.

Equifax Touchstone's general manager, Neil Cunningham said: "This reduction in intermediaries - who are essentially the distribution channel for many products - means it is crucial for providers to understand the profile of those remaining to ensure they can deliver sales for long-term growth and market share objectives."

Analysis from quarter 1 in 2013 has also identified a shift to higher value products being advised by those remaining in the marketplace.

Cunningham said: "The implication of this new data is that advisers are adjusting their offering to concentrate on higher net worth clients more likely to be willing to pay fees.

"In such a changing intermediary landscape, it is vital providers know their intermediaries and how they are performing in their local market. Businesses that don't understand this shifting focus could lose market share quite quickly."

Meanwhile, a recent study by Standard Life said the UK needed 5,000 extra advisers to cope with the rising demand of advice, particularly in relation to retirement income.

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