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The FSA and insurers totally miss the point on our profession

Bhupinder Anand IFA View

In my last article, I related the tale of an IFA who called me to kindly offer his services in looking after my clients but, in doing so, exhibited his own lack of preparedness for RDR or, indeed, the 21st Century. In particular, he failed to realise that to offer everything to everyone and in no special way showed flaws in his business model that the new regime will be deadly in exposing.

This month, I got a phone call from another IFA seeking tips on how his trainee adviser could develop new sales skills, especially in the protection market, in order to sustain a long-term career. No doubt, many mortgage brokers are also wondering how to gain this new expertise.

The conversation revealed how RDR and some industry commentators totally missed the point about the future of our great profession. The FSA just don’t get it. By emphasising the need for qualifications over and above other attributes, with absolutely no appreciation of what we do for our clients, the RDR is systematically destroying accessibility to quality advice for the public, aided and abetted by insurers.

Relevant qualifications are no doubt essential but, on their own, are useless. You see, this trainee IFA is well qualified and keen to progress but there are virtually no opportunities to learn how to, dare I say it, sell.

It is all very well having prac-tice development seminars and new product workshops, crea-ting a small army of educated advisers versed in great systems but if they can’t motivate people to take action, so what?

Insurers just don’t get it. For example, Aviva national sales manager Richard Verdin recently claimed in an article that “…(sales) training sessions which included ‘golden geese’ and ‘money machines’… do not quite cut the mustard in today’s world”, arguing that raised qualifications and product knowledge were the solutions to the protection gap.

How disappointing that a respected industry figure fails to understand the maxim “Our clients do not care how much we know until they know how much we care”. No one has ever bought life insurance because they were inspired by a certif-icate on the wall.

Sales skills, anecdotes and analogies motivate people to do the right thing for their families, their businesses and themselves, not a fancy piece of parchment. In fact, I am grateful to Richard for reminding me of the “insure the golden goose, not the eggs it lays” metaphor as I success-fully used it to secure a £1m sum assured case last week.

I recently gave eight speeches in Australia, training advisers how to sell in a holistic profess-ional, ethical and modern manner. The Aussies recognised the need to develop these skills yet it remains incredibly remiss of both UK insurers (as eviden-ced by Aviva’s stance) and the regulator (as evidenced by RDR) in failing to appreciate what really makes the difference between proficient advice and meaningful action.

Bhupinder Anand is managing director of Anand Associates


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There are 3 comments at the moment, we would love to hear your opinion too.

  1. I agree 100% with Bhupinder. If qualifications alone could ensure good advice then why are so many lawysrs and accountants in jail? The FSA’s challenge is that ‘Trust’ can’t be measured, yet it’s that very ingredient our clients and prospects are looking for. By showing we care through asking the right questions we build trust, and yes, it’s called selling!

  2. The financial services shall in effect always been sold and rarely bought.Anyone whom claims they are not selling when advising at some point is a Kidder.There is nothing wrong in selling professionally as long as you are acting ethically, and acting in the interests of your customer/client.

  3. It is extraordinary that having had over 25 years since disclosure was first introduced that the industry still has not been able to decide where the responibilty for advice lies.

    Put simply, it is not with the clients, nor the providers, it is the advisers, be they tied, multi tied or independent. It is they that are charged by the clients to provide the best options at any given moment in time. The clients will be sold to and accordingly the providers must ensure that they have provided the best possible support to any distribution channel that they accept business from.

    The provider that takes the step to invest in all its distribution and offer real aid and supporrt to all of them will reap the benefits. “Hands off” has been the order of the day for too long, grasp the nettle and step up providers, identify who you want to distribute and support them. Why not set them annual competency test, when they pass, support them.

    Providers, you are best placed to lead, do not wait for the legislation any longer, 25 years and it hasn’t happened. Take steps to protect your industry by developing what the industry needs, providers that actually believe in the advice being delivered in the field.

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