View more on these topics

Lovey wants insurers to scrap ‘painful’ clawback

Insurers are being called on to pay lower up-front commission and remove clawback on life policies.

Danny Lovey, sole practitioner at The Mortgage Practitioner, says advisers “cannot live on fresh air” and need some form of up-front payment to cover the cost of the fact-find, compliance and application process.

But Lovey says if advisers were paid lower non-refundable initial commission and then trail commission from month nine of the policy until month 24, the financial strain of clawback could be removed.

He says some policies will inevitably lapse, for example, when a marriage breaks down, and he feels clawback punishes the adviser and means they do not get paid for the work they have done.

Lovey says: “All my expenses are up-front so taking commission on the drip is not inspirational. But more and more policies are dropping off and it has nothing to do with churning, it is because of Britain’s changing demographic. Paying back money from your earnings can be painful.”

CBK principal Peter Chadborn says advisers can reduce the number of policies falling off their books by selling policies with more flexible features.

He says: “If the client’s needs have changed and the adviser has sold them a product with flexibility built in, they will not be worrying about clawback.

“If business is coming off the books, you have got to analyse why and often it is because the adviser has recommended products based on price.”


Threadneedle picks new chief executive

Crispin Henderson has taken the reins as chief executive at Threadneedle as part of a senior management reshuffle at the firm.Previously managing director, Henderson took over on August 1, with current chief executive Simon Davies becoming executive chairman with responsibility for client relationships, strategy and talent management within the business.As chief executive, Henderson will be […]

Insurer gives discounts to veggies

Animal Friends Insurance says it will offer vegetarians and fish eaters a 6 per cent discount on life cover. The insurer says vegetarians are less likely to suffer from a range of chronic diseases.

Family ties

How a series of Sipps can be set up to enable a joint property purchase

Advice model not broken, says Aifa

Aifa says industry research shows that the IFA sector had turnover of £6.5bn last year and net profits of 13.5 per cent, which contradicts the FSA’s assertion that the advice market is not sustainable.Director general Chris Cummings says the economic value added to the UK by financial advice and the financial robustness of the sector […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    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