Regulation of the sales process of Ron Sandler's stakeholder style products is only one part of a “three pieced jigsaw puzzle” according to the ABI and on its own will not help to close the savings gap.
Responding to the FSA's Discussion Paper 19 published yesterday which outlined three possible sales regimes for the new stakeholder products, the ABI said the options are a useful starting point but that minor amendments to the current rules will not make the difference needed to close the savings gap.
The FSA discussed three alternatives for the sales of Sandler's so-called safe-haven products, the first having warnings about product suitability but no advice, the second where advisers are permitted to ask consumers filter questions decided by the regulator and the last where low-level advisers would make suitability decisions within guidelines set out by the FSA.
ABI director general Mary Francis says: “We must not forget that getting regulation right is only one component of making Sandler work. Not only does regulation need to be right, we need to make sure that the price controls and the product definition itself, give us a package that providers can offer and customers will want to buy.”