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Financial services need to be sold

At a fringe meeting at the Labour Conference, Ron Sandler implied that most people are perfectly capable of sorting out their own financial requirements. I believe the crisis facing the industry is that the FSA, Ron Sandler, the Treasury and others that make the rules and influence the industry do not understand the financial adviser&#39s raison d&#39etre.

The policymakers do not realise that the most perverse attitude of humans is that they do not look after themselves. Generally speaking, people do not buy life insurance, pensions, income replacement plans, critical-illness cover or make wills.

But the fact is that every day in the UK an average 1,800 people die, 500 wives become widows, 45 dependent children lose their father, 900 people retire only on state benefits, 450 people fall ill and will be unable to return to work for more than six months. The majority have little or no insurance or savings.

This is the reason why sales people are needed, and concomitant commission. Do the policymakers really believe that people will buy pensions and life policies because they have a cost cap? Do more employees invest in pensions because their employers have a stakeholder scheme?

Financial advisers provide their clients with dignity at the most important times of their lives: ill health, death and retirement. It is due to their skills, perseverance and hard work that their clients are protected.

Commission is necessary because people require an adviser to persuade them to buy financial services products and put their affairs in order. The adviser needs to be rewarded for this.

Ignorance is a result of not understanding that life insurance, income replacement and pensions have to be sold.

Bernard Dokelman

Sovereign (Financial Services) Group,

London

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