View more on these topics

Driving force of with-profits

I recently followed a plumber driving erratically, with his mobile phone number proudly displayed on the van. I rang him from my hands-free phone, commenting that if my driving was as appalling as his I would not want people to have my phone number.

I was reminded of this incident when I read Philip Milton&#39s letter (Money Marketing, May 6) in which he grossly over-simplifies the endowment matter and demonstrates a remarkable lack of knowledge.

Just possibly, it was the “obscene commission” which enabled Terence O&#39Halloran and others like him to service his clients year after year without further payment and to be there to deliver the proceeds of maturing policies and death claims.

It was the inclusion of profit made on the sale of term insurance which added so much to the attractiveness of the original traditional with-profits products.

I know of no other way to benefit from the enormous profit made on term insurance, other than owning a life company or being a with-profits policyholder.

As for the “one size fits all”, I think Mr Milton would find that Terence O&#39Halloran&#39s clients were offered a range of solutions, only choosing a low-cost endowment policy where it suited their needs at the time.It was the bundling of premium waiver, life cover, critical illness and, in some cases, payment protection which made the product such good value. Some clients actually preferred this to having separate vehicles, with their own charges, etc.

The life companies have made an appalling job of explaining how their products work and have been quite happy to allow the front-line troops (IFA or tied) to be the cannon fodder for the criticism, much of which is justified and a lot of which is not.

Lee Clarke

Thomson&#39s Wealth management,

Cardiff

Recommended

Scottish Equitable goes against the grain

SCOTTISH EQUITABLE Flexible Pension Plan Type: Individual personal pension with insured and self-invested options Minimum premium: Insured option &#45 £20 a month, £200 a year, lump sum/transfers £2,500. Self-invested option &#45 Lump sum £2,500 Minimum-maximum ages: 18-74 Fund links: Insured option &#45 choice of 40 internally managed funds and 26 externally managed funds from Baillie […]

Wake-up call for industry

The key findings of research among consumers carried out by NOP for the FSA were that: • Consumers generally find it difficult to compare financial companies or advisers, mainly because it is thought to be confusing • Over 25 per cent of respondents were not aware of how firms are rewarded for selling products or […]

Networks will keep their VAT exemption

Your recent headlines concerning the possibility of VAT being imposed upon network services do not deal with the origins of the VAT exemption and why this exemption is unlikely to be successfully challenged by HM Customs and Excise. The legislation concerning VAT and the provision of insurance services is complex but, by way of brief […]

New Northern UK head for Cavanagh

Cavanagh Group is appointing Peter Young as sales manager of the company&#39s northern region. Young – who is a past Sofa award-winning adviser – joins Cavanagh from Momentum as it is absorbed into Aegon&#39s amalgamated IFA operation Origen. Young will be responsible for the Scottish and North of England areas and is briefed to expand […]

How to balance bottom-up with top-down research in constructing multi-asset credit portfolios

In this short video, Azhar Hussain, head of global high yield at Royal London Asset Management, explains how his team balance bottom-up with top-down research in constructing multi-asset credit portfolios. Watch the video in full The value of investments and the income from them is not guaranteed and may go down as well as up […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com