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Baigrie warns of influx of “low quality” protection advisers

Lifesearch chief executive Tom Baigrie believes there will be an influx of poor quality advisers in the protection market as a result of the RDR and the introduction of gender neutral pricing.

Baigrie fears unscrupulous advisers will try to take advantage of the fact protection is not covered under the RDR and a potential increase in business if people look to review their cover when gender neutral pricing is introduced.

Speaking at the Lifesearch awards in London on Wednesday, Baigrie said: “What we fear is that with RDR approaching and premiums set to rise, our market will attract many new starters and a lot of them will be of very low quality. What we fear is provider eagerness to maintain market share will accelerate the already endemic granting of agencies to frankly dodgy distributors, who are thus allowed to sell great brands and good products awfully.

“A client ripped off by one of these will hate our industry and possibly your brand forever. In our opinion, you simply have to stop to stop the laissez faire approach to the quality of distribution and the granting of new agencies.”

Axxis Financial Planning director Owen Wintersgill says: “I do not think this will happen. The vast majority of protection cases are linked with when people take out a mortgage and I think a lot of advisers will be put off by the fact that brokers are struggling at the moment, so will not want to enter that sector.”

Lifesearch also launched a code of conduct for protection sellers at the awards ceremony.


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

  1. Tom you are absolutely right. I work for a large Network and there is an increasing number of CF30 Investment Advisers who realise that they will not be able to pass their exams by the end of the year and are throwing in the towel now. Many of these advisers are at the lower quality end of the market and generally low prodcuers. Many I suspect would earn more money if they got a job stacking shelves in Tesco’s!!!

  2. Having viewed the internet only offering from price comparison websites, they promote life and CIC reducing term with only a fraction of the insured amount as CIC. This gives them a price advantage over the proper 100% CIC that should be advised. Then they make it extremely difficult to obtain a quote for 100% CIC, as they have no price advantage.
    However there are some firms out there who ask want you to apply for life cover via a pop up and who do not identify themselves initially, so you dont know who you are dealing with. Then call you up out of hours to sell their scheme. Who is the most honerable of these two?

  3. Simple answer, make them qualify to QCF Level 4 with mandatory pass of RO5 as part of that.
    Puts them in the same position as the rest of us.
    Just passed RO4 now studying RO5 and take that exam in April
    I don’t see what the problem is, but if there is a problem with adviser quality, that has to start with the recruitment process.

  4. StillChasingTheDream 9th March 2012 at 3:54 pm

    There is going to be an influx of dodgy distributors and it is already happening. But then, whatever the flavour of the month was in the past, e.g.SSIPS/SSAS, pension transfers, self-cert mortgages, high-commission investment bonds, and now protection – the industry always attracts a certain number of chancers.

    It will always be so. Why should we be any different to other professions? After all the legal and accountancy ranks also include a number of such operators.

    What we need to do, instead of beating ourselves up so much, and publishing articles that only serve to undermine our cause, is to concentrate on taking our message to clients, many of whom desperately need our products and services.

    Find a niche, get into markets not penetrated to any degree by the mass of advisers and the internet and phone sales people, and don’t worry about dodgy people at the lower end.

    Business protection anyone?

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