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Baigrie call for action on non-advised firms

Lifesearch managing director Tom Baigrie says intermediaries should consider refusing to give business to protection providers who work with certain non-advised sales firms he believes are failing to treat customers fairly.

Writing in this week’s Money Marketing, Baigrie argues that if providers trade with non-advised sales firms, they should have to prove to IFAs they have made sure these firms have a robust sales pro-cess in place. If they do not agree to this, he says, IFAs should consider refusing to give them business.

According to Baigrie, IFAs suffer when customers are treated unfairly by some non-advised sales firms as the whole industry is blamed.

He says: “IFAs can easily require the provider partners who seek our protection business to demonstrate they do not support retailers who do not treat customers fairly and that they are certain their customers do not feel advised when they have officially had no advice. If they refuse, then our business should not go to them, except in the rare cases when it must to treat the customer fairly.”

But the Association of British Insurers says it is not up to providers to police rogue companies. Assistant director of health and protection Nick Kirwan says: “If distributors are arranging policies, then it is for the FSA to ensure they are doing so compliantly.

“These are independently regulated firms and it might be hard for providers to make judgements about whether independent firms are complying with FSA regulations.”

Kirwan adds that the FSA is much better equipped than providers to tackle hard-sell sales tactics as it can carry out mystery shopping exercises to make sure regulatory standards are being adhered to.


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There are 4 comments at the moment, we would love to hear your opinion too.

  1. Absolutely agree….!!

    An an advice based firm, we feel that Tom’s words hit the nail on the head.

    Something needs to be done to protect the Industry we work in.

  2. Michael Fallas 11th June 2010 at 5:22 pm

    Who are these companies he is referring to and if they are a problem to his business why not take it up with the FSA after all that is what we pay them very well to do?

    Don’t really think providers care where the business comes from to be honest.

  3. When I worked for a large insurer, the senior staff attitude was that there wasn’t enough professionalism in the market place as far as agents (including in those days non-professional agents) were concerned.

    Their attitude changed as soon as anyone, even without experience or qualification had what they thought was a decent chunk of business. Irrespective of professionalism they did it if they could. They would then bleat about professionalism again afterwards!

    My experience of insurers since has not led me to change my mind on how they react, so the ABI stance should come as no surprise.

    Isn’t the answer for IFAs and insurance brokers to boycott insurers who deal with so-called “non-advised” sales?

    I wonder if the purchasers of such sales would regard what they were told at point of sale as “not advice?”

  4. I completely agree with the fact that the way certain companies offer ‘non-advised’ sales tarnishes the market as a whole. I’m not going to beat about the bush, so let’s take Click as a prime example.

    I challenge anybody to contact them and ask to take up a policy through Legal & General, Royal Liver or Scottish Provident and see how hard you are driven away from these companies on to either Fortis or Pru-Protect.

    It absolutely astounds me that in their initial disclosure document they claim to be Whole of Market. I’m told by a colleague that the loop hole is that they can QUOTE whole of market, but they just cannot SELL whole of market!

    As far as the previous article that Mr. Baigrie wrote on the same subject, the carrot that can be dangled by a company such as Click in terms of business volume is very hard to resist.

    History however dictates that they have done nothing but screw over both insurance providers and customers by setting ridiculous targets to sales staff, and not paying back the inevitable clawbacks that will come as a results. £1.2m owed to Fortis and an unconfirmed sum owed to L&G should not be what companies such as Pru-Protect are looking for as a protection partner.

    Pru have now been confirmed by our own company’s Pru BDM as Click’s ‘priority’ CIC company. How can this possible be TCF if they have a priority company anyway? I think that the fact that their sales team is now down to 40 odd staff from a previous 90 is a clear indication that this firm won’t be around for much longer anyway – something that I cannot wait for as the ethos of the entire protection market will benefit from as a result.

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