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Advisers fear being forced into multi-ties

IFAs believe major life offices are planning to dominate the market,

forcing independent advisers into becoming de facto multi-ties.

The fear emerged at the PIMS thinktank on polarisation. IFAs believe big

insur-ers are aiming to take con-trol of the market and take away IFAs&#39

powers.

Although advisers agreed most of their business is written with fewer than

15 providers, many felt not having the pick of the entire market would

inhibit innovation and lead to an uncompetitive marketplace.

One IFA said: “I can see a situation where life offices say to IFAs, we

will only do business with you if you guarantee us a set percentage of your

business.”

Delegates also believed consumers remain confused about the status of

advisers and underlined the importance of communicating independence and

its value to clients.

LIA president Peter Sprung argued for the rules on polarisation to remain

unchanged as any further alterations would leave clients even more baffled

at the difference between independent financial advice, tied agents and

multi-ties.

He said: “People are starting to understand the difference between

independents and tied. Any change would undo years of education.”

Aifa director general Paul Smee says the biggest issue IFAs wanted to

discuss at this year&#39s PIMS was regulation.

Smee met individually with dozens of independent advisers at the event,

many of whom had regulation at the top of their agenda.

But in spite of fears concerning the increasing compliance burden,

advisers were reporting increased business levels, with many looking

forward to expanding their businesses in the coming year.

Smee says: “We at Aifa need to make sure the environment is right for that

growth.”

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