View more on these topics

Offices withdraw IFA guidance on contracting out

Life offices are withdrawing their contracting out recommendation templates after recent changes to rebate levels have made the decision too close to call.

The move leaves IFAs with nowhere to turn for guidance as they wrestle with the marginal differences between Serps and contracting out before making a recommendation.

Until recently, most life offices provided model age and salary recommendations which relieved advisers of some of the burden of determining best advice for their clients considering contracting out.

But since the Government Actuary Department set rebate levels in March which were not generous enough to make the decision obvious to policyholders and their advisers, life offices have been forced to wash their hands of respon-sibility and leave these decisions purely to IFAs.

Legal & General this week joined other life offices saying they are not able to offer recommendations on pivotal ages either for their salesforce or IFAs.

L&G pensions marketing manager Andy Agar says: “Clearly, the whole industry is wrestling with this issue and no one is saying publicly what their view is. Based on a single-charging product at 1 per cent, it is often not demonstrably better to contract out. We are conscious we need to tell IFAs and while normally we would want to make recommendations it is very difficult to do so. Contracting out is now more a question of the customer&#39s attitude to risk.”

Torquil Clark pensions development director Tom McPhail says: “About two years ago, every life office would produce pivotal ages. Now hardly anyone does, casting IFAs out into the wilderness. The Government Actuary has made rebates deliberately marginal, so the issue has becomes less about numerical issues and more about who the client trusts more – either the Government or life offices.”


Trackers – the debate continues

Archie Clifford&#39s suggestion (Money Marketing, May 17) that “God invented trackers” said far more about the quality of his “rational” analysis of that product than anything I could write. Indeed, his defence of trackers contained every platitude from “prepare to meet thy doom” to “kindly adjust your address before leaving”. Perhaps Mr Clifford failed to […]

Goodfellows –

Tuesday, 29 May 2001.Type: Income protection.Minimum benefit/premium: £100 a month/£2.50 a month.Minimum-maximum ages: 18-65.Deferred period: 30 days.Charges: None.Definition of disability: Own occupation.Commission: Initial 20 per cent, renewal 20 per cent.Tel: 01376 347369. 

Halifax using Midshires for sub-prime launch

Halifax is set to enter the sub-prime market this year through specialist lending arm Birmingham Mid-shires in a move it claims will “shake up” the mortgage market. Midshires head of lending Michael Bolton says it will launch into the adv-erse-credit sector in the autumn with a range of products which will “redefine the pricing structure […]

Mortgage Next – Buy To Let 5 Year Fixed Fee Saver 85 Per Cent

Thursday, 31 May 2001.Type: Fixed rate buy-to-let mortgage for members of Mortgage Next service.Fixed term: Until July 31, 2006.Fixed rate: 6.74 per cent.Minimum loan: £15,001, remortgages £25,001.Maximum loan: Up to 85 per cent of valuation subject to no maximum.Income multiples: Rental income must be at least 125 per cent of monthly mortgage payment.Arrangement fee: £399.Redemption […]


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