At an analyst presentation last week, Aviva said it expects IFA numbers to plummet from 21,000 to 10,000 by 2013. It believes that 25-30 per cent will retire or leave the industry and the balance will become tied advisers or join banks.
It claims this exodus will create a provision gap which it plans to fill by boosting its direct salesforce which presently totals 100 staff but it would not reveal how much this is likely to grow.
Marketing director David Barral says: “Our salesforce is going to grow as a result of the retail distribution review because a significant amount of IFAs are likely to leave the industry. We have got to be realistic in terms of planning what the eventual outcome may be. We will increase staff in line with the opportunity as it develops.”
The firm plans to target the 1.4 million existing Norwich Union customers it estimates to have no active adviser.
But Barral insists the move will not affect IFAs as clients must provide written confirmation they no longer consult an adviser.
He says: “Because we have 1.3 million customers who have come through directly and a further 1.4 million who no longer have an active adviser, rather than actively acquiring new business, which is expensive, we are redirecting some of that resource to target existing customers. We are not stepping on IFAs’ toes here. These are clients who have had no contact with an adviser for at least five years.”
Baronworth Investment Services director Michael Brill says: “I do not think this is fair. In a lot of cases it will be a very fine line between encroaching on IFAs’ clients. I think the only way that Aviva can do this is check out whether the financial adviser is still in business or not and, if they are, just leave it alone.”
Aviva is also to scrap either the onshore or offshore bond from its wrap, which it is set to relaunch in July.