As the industry moves towards greater charging transparency it is about time some providers got a bit more professional in the way they treat advisers.
With the abolition of commission and creation of more explicit charging agreements, provider service levels are going to come under greater scrutiny from advisers as poor service is more likely to directly hit clients’ pockets.
One important area where some providers have so far failed to acknowledge the changing marketplace is over ensuring advisers are appropriately remunerated for sorting out poor service standards.
This week’s issue of Money Marketing includes details of a complaint brought by an IFA against Cofunds on behalf of a client.
After admitting to failures which led to the client being unable to make a £30,000 investment into his pension before the end of the 2011/12 tax year, Cofunds quite rightly compensated the client for the tax relief lost.
However, when the IFA, Peter Herd, billed Cofunds for his time spent helping the client, the platform would not pay up. Cofunds pointed Herd to its terms and conditions which highlight that it will not compensate advisers for time spent ensuring any client detriment is sorted out.
Such a standpoint is unacceptable and needs to be challenged.
Herd says Cofunds advised him he could be paid from the compensation due to his client but why should the client pay?
Alongside full compensation for the client should come a fair amount of money which takes account of the time spent by the adviser on this case.
Herd will now be taking his case to the small claims court but it is regrettable that such actions are necessary.
Last month, Money Marketing reported on another case where Aviva failed to pay an adviser his full hourly rate of £250 to sort out problems caused by poor customer service, instead paying him £100 an hour.
It is perhaps time to debate the introduction of some industry standards to ensure IFAs are paid appropriately for dealing with such issues. Hiding behind the small print of terms and conditions is no way to deal with the changing demands of advisers and their clients.
It is about time providers started treated IFAs like adults. Professional advisory businesses should be allowed to bill appropriately for the time it takes to sort out errors on their clients’ behalf.