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David Marlow

I say tosh to all those who think execution-only services cannot work.

Focused advice or, in compliance speak, limited advice, where a client does

not receive advice on financial needs and objectives but instead receives

advice on one specific aspect or area of need, is another of the issues

which seems to provoke opposing views.

Personally, I think there is a place for both focused

and holistic advice. Going further than that, I think it is good to see

execution-only and direct-to-provider propositions available. The point is

not that one type

of service is better than another but that it is good that

they are all available.

As I see it, these choices are good for consumers which, in turn, is good

for advisers. Trying to adopt a simple outsider&#39s perspective, how might

the various options appear?

l “By going direct, I will conduct all my own research and be able to

collate all the facts myself. This proves more difficult than I had at

first imagined. But, if I do it all myself, I will retain full control.

Against this, I am learning that some of the providers will not deal with

me direct, explaining that there can be a lot of complex administration

which has led them to accept business only when submitted by professionals.

Added to which, I might not even pay less as some providers may operate the

same pricing for direct purchase as they do for IFA-introduced.”

l “By using an execution-only service, I get help. In short, an IFA

carries out all the research and administration on my behalf. All I need to

do is make a decision, which again maintains control, but I must accept

that receiving no advice places the burden of responsibility on me. Of

course, one way or another, I will have to pay for the help I receive.”

l “I can get more help by choosing an advice service. This may cost me

more but it does mean that I have greater protection against buying an

unsuitable product.

I still need to think through my options but I will only take decisions

once I have received recommendations specific to my circumstances and


l “I understand I have a choice of advice services. I can receive limited

or holistic advice. If I choose a limited advice service, I must accept

that other aspects of my financial affairs will not be addressed. This may


that I risk taking action on one aspect when another may actually be

higher priority. If I choose an holistic advice service, all my needs will

be assessed but this is likely

to take longer and I will have to spend the most time preparing information.”

As we all know, public faith in financial services could be higher. It is

also widely agreed that the continuing drive for higher professional

standards is fundamental to achieving any improvement. But so too is


On a macro level, if we are shown to be inflexible and protective of our

practices, we are unlikely to build greater confidence. I think the range

of advice services available is as such a presentation issue.

Yes, there are issues of concern that need to be dealt with and, yes, not

all the choices are appropriate in all cases but to be dismissive of some

of the options outright would be an own goal.

The forthcoming changes to polarisation will also

have a bearing here. I suppose, with my comments in mind, I should welcome

these changes. But I do not.

I do not believe they materially extend the choice for consumers and will,

therefore, do little other than cause confusion which could damage consumer


In conclusion, I feel that the range of different services on offer

already serves well. I hope that the provision of choice from fully

independent advisers will thrive and that in-fighting over the different

propositions will be left behind as we focus on providing our customers


what they want.

David Marlow is head of marketing at The Annuity Bureau


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