Some life insurers are finding it harder to get repeat business from IFAs, according to data from financial research company Henry Samuels Marketing Services.
Most life companies gain high penetration levels within the intermediary sector, with some product providers used by 90 per cent or more of the IFA population. But only a small number of these advisory firms give these providers regular repeat business.
A study of 300 IFAs shows that three out of 10 major life offices saw a decline in regular repeat business from IFAs between February and August.
The only life office which showed a marked improvement was Scottish Widows, with the percentage of IFAs surveyed who generate regular repeat business for the company increasing from 13 per cent to 20 per cent.
HSMS concludes that for most life companies, despite relatively high levels of penetration within the sector, most IFA firms are not effective business producers.
It concludes that life offices should look at dealing with fewer IFAs. Its measure of market penetration efficiency reveals that life offices are continuing to deal with more IFA firms than are generating meaningful business which must be costly.
HSMS spokesman Henry Samuels says: “We all know that many IFAs claim to deal with all or most major companies and they probably do but in reality there are those IFAs who have contact and receive support from many product providers yet only give a significant volume of their business to a restricted group of providers.”