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Inside Edge

With recognition from Treasury minister Ruth Kelly, the Raising Standards

quality mark scheme is gaining momentum and credibility in its second year.

As one of the first companies to be accredited for the Raising Standards

scheme with the Scottish Equitable brand and also one of the first to renew

our accreditation for a second year, I am delighted to see the scheme is

gathering momentum and, more importantly, credibility as it enters its

second year.

Let&#39s not kid ourselves here. Raising Standards has never been short of

detractors. Industry observers have dismissed the scheme as irrelevant, too

little too late – something that the industry should have been doing a long

time ago. Many have suggested, wrongly, that Raising Standards is simply

about tinkering with the wording in the brochures.

Anyone involved in the rigorous accreditation process which addresses the

total service proposition including customer service and satisfaction,

product design as well as customer-facing literature will be aware of how

gaining and keeping accreditation is a demanding and onerous exercise.

Raising Standards has delivered three core objectives – increased clarity

and comparability of information, improvements in the fit between the needs

of the consumer and the product they purchase and increased focus on

customer service.

No one is suggesting that Raising Standards is the pan-acea of the life

industry&#39s ills. But research suggests that it does go a long way to

addressing some of the key concerns of consumers when they are looking to

save for retirement, or take out insurance to protect their families.

This year, we have heard much discussion of the £27bn savings gap and

the emergence of the protection gap which is estimated to be many times

this amount.

However, as an industry, arguably the biggest problem we face is the

credibility gap. That is, the lack of trust and belief on the part of

consumers as regards financial services providers.

Unless we can bridge this credibility gap, the financial health and future

prosperity of the UK is in jeopardy. Not to mention the future business

development of the life insurance industry.

Against this backdrop, surely a scheme such as Raising Standards can only

be of benefit to consumers, financial advisers and providers alike.

On the second anniversary of the scheme, Raising Standards received its

most significant accolade to date. Treasury financial secretary Ruth Kelly

praised the scheme for its role in codifying the way that firms communicate

with consumers, which she saw as important to the Government&#39s strategy of

“empowering consumers through education and information and making the

market work better for the many”.

Kelly also recognised the impact of the reforms brought about by Raising

Standards, including the acknowledgement of the scheme in the Sandler

review and FSA rev-iew of with-profits funds and the fact that Raising

Standards already addresses many of the issues raised in both these reviews.

The scheme was also lauded for having attracted over one-third of the

industry by market volume.

So, as the scheme develops and further brands are accredited and, more

importantly, accredited on a yearly basis, it is heartening to see that the

efforts of those companies who have supported Raising Standards have not

gone unnoticed.

Looking to the future, one of the reviews due out in 2003 is the FSA review

of product disclosure which will examine the format and clarity of product

literature and consumer understanding. Raising standards has made

considerable impact in this field and it&#39s to be hoped that the FSA will

take account of this in its review.

Peter Dornan is director of group businesses at Aegon UK

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