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Fears that filtering questions may lead to misselling

Many advisers are worried that the use of filtering questions could be open to abuse or lead to unqualified advisers providing advice.

Seventy-eight per cent believe that the use of filtering questions or decision trees could lead directly to lesser-qualified advisers offering advice.

The FSA&#39s depolarisation proposals have led to suggestions that decision trees should be used as a means of selling the Sandler suite products because they are simpler and the regulator argues that the products could be sold in a different way using decision trees as educative tools.

The FSA&#39s discussion paper 19 sets out options for the advice process. These range from placing the onus entirely on the customer to understand and purchase the product through filtering questions, to the adviser taking total responsibility for assessing the suitability of a product for his or her client.

Aifa holds the view that decision trees should not be a stand-alone tool for consumers excluding the adviser but should play a part in the advisory process.

Aifa director of public affairs Tracey Mullins says: “Just because a product is deemed &#39safe&#39, it does not mean it is suitable for everyone. Firms are also concerned that if they say they are offering no advice and just walking clients through a policy, they risk a comeback in the future from people who may believe that they were missold.”


Product matters

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ABI wants protection risk rating reduced

The ABI and protection providers are lobbying the FSA to abandon its classification of protection products as higher risk than other types of general insurance as it designs its regime for their regulation.In CP160, the FSA proposed placing protection in a “higher-risk” category than other types of general insurance because it says their long-term nature […]

Don&#39t get too fixed on the short term

Much is being reported about the seemingly unstoppable increase in popularity of fixed-interest investments such as corporate bonds and gilts.Presumably, this is mainly down to advisers recommending them as an alternative to equities. This is a dangerously short-term approach and may lead to more upsets, given that the present stage in the price cycle of […]

Nurseries enterprise

Teather & Greenwood Investment Management has introduced Childcare Corporation 6, an enterprise investment scheme that aims to raise up to £10m for the building and operation of around 10 purpose-built children&#39s nurseries in the Midlands and the South of England.This EIS takes up the objectives of the previous five Childcare Corporation schemes by providing private […]

Inheritance tax and estate planning – exemptions and reliefs

By Kim Jarvis, technical manager with Canada Life’s ican Technical Services Team In this article we look at the main exemptions and reliefs that are available on death. Within the article, spouse also means civil partner.   Nil-rate band Under current rules, any part of the estate that falls within the available nil-rate band (NRB), […]


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