Advisers fear the FCA’s desire to crack down on unsuitable defined benefit transfers is likely to increase costs for consumers.
At the end of March the regulator published a policy statement on transfer advice that said accepting free transfer value analysis software now fell within its definition of inducements.
Subsequently, providers including LV, Old Mutual Wealth, Pru, Scottish Widows and Standard Life shelved their services to avoid falling foul of the rules.
Advisers spoken to by Money Marketing have expressed fears about the unintended consequences of the FCA’s stance.
Appleton Gerrard financial planner Kusal Ariyawansa thinks there is no harm in receiving a free TVAS report as long as the adviser knows it is not the only solution for the client.
He says: “As an adviser, you must consider all other solutions. It is therefore best to have your own independent arrangements. All costs are eventually borne by the client.”
Thameside Financial Planning dir-ector Tom Kean says his TVAS report work used to be done by Standard Life, but he has brought the service in-house even though some third-party offerings are “eye-wateringly expensive”.
He adds: “Life has got a bit more complicated and costly for the consumer because [free TVAS reports] are now an explicit cost IFAs will charge a little extra for. It is another irritation we could do without but we will probably absorb the cost.”