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&#39Set your own premiums&#39 ad raises misselling fears

An insurance provider has been forced to rethink its advertisement for a

single-premium product amid outrage that it could attract interest from

unscrupulous advisers.

A Bennett Gould & Part^_ners advertisement for an accident, sickness and

unemployment insurance product, Mort^_- gageSafe, has brought fears of

misselling. The ad says: “You decide on the gross premium charged. We

deduct a net premium and the balance is your commission.”

Some commentators say this could encourage unscrupulous advi^_sers to

charge consumers what they like.

The Essex County Coun^_cil trading standards department is investigating

the ad following a complaint from another product provider.

Mortgage consultant Monty Burns backs an investigation into the product&#39s

terms of sale. He fears some advisers who previously specialised in

end^_owments will be attracted by the ad in their search for income

following
the decline of endowment sales. He says: “Why should one

customer pay more than another? This form of commission structure is just

not honourable.”

After the criticism, Bennett Gould & Partners has pro^_mised to take

action. Managing director Michael Gould says: “It is a fair comment that

single-premium products do carry a danger and we need to look into the

parameters we allow. We will be cutting the offending paragraph and working

with the trading standards department.”

Acquisitive network Misys&#39s bid for ie group has been referred to the

Office of Fair Trading over fears that
it could be breaking monopoly

regulation.

ie group owns IFA Network and its acquisition by Misys would make Misys

the dominant player in the
market with some 4,000 RIs. Misys already

owns networks Financial Options, Kestrel and Countrywide.

Referrals are made to the OFT when a deal means that a company will corner

over 25 per cent of the market or have assets of more than 70m. The OFT

will scrutinise the deal before making recommendations to the Secretary of

State for Trade who in turn makes recommendations to the Competition

Commission.

If the OFT should advise against the acquisition, then the 21m deal, due

for completion in May upon approval from ie group shareholders, will fall

through.

Misys spokesman Alastair MacDonald says: “The referral is no surprise as

the deal will place us in the top five of networks. However, we do not

believe that it is anti-competitive as we will control under 20 per cent of

the IFA market.”

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