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&#39Life offices rush to sign up IFAs in multi-tied race&#39

IFAs and providers are warning that the polarisation decision will kickstart a scramble for distribution backed by generous commission deals for multi-ties.

The networks are top of providers&#39 lists as they vie for inclusion on multitie panels if IFAs decide to convert.

Some life offices believe multi-ties will be able to name their price on commission levels, at least initially.

A survey by financial services law firm Armstrong Neal shows 83 per cent of IFAs believe networks will become multi-tied.

But other life offices have pointed out that networks do not own their members and they believe the rush to buy distribution is premature as many IFAs will keep their independent status.

Clerical Medical predicts 10 per cent of IFAs will turn to multi-ties as most will want to stay in control of their own businesses.

One option could be for networks to split their operation to offer a multi-tied route for some advisers and retain independent advisers.

InterAlliance chief executive Stuart McGreevy says: “There will be a distribution scramble. In the mass market there will be an advent of multi-ties because margins are so low.

“There will be a lot of pro viders becoming very active to secure distribution.”

DBS Financial Manage ment spokeswoman Sue Lewis says: “At the moment, and for the foreseeable future, we are nailed to the IFA proposition.”

Norwich Union Life sales and marketing director Peter Hales says: “In the short term, there is danger of increasing commission as product prov iders look to open up markets for stakeholder products and attempt to buy distribution.”

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