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Service charge

Some IFAs are refusing to place business with product providers which do not deliver on service but Nicola York finds that some companies say they are improving their admin in a bid to regain brokers’ confidence and business

Chadborn Baker & Kearle principal Peter Chadborn says he has seen no improvement in providers’ customer service in general.

A survey of SimplyBiz advisers three months ago revealed that big-name product providers, including Abbey, Norwich Union, Prudential and Liverpool Victoria, all scored lower than five out of 10 in areas such as commission and head office contact.

Chadborn says: “We have not seen any improvements, with the exception of the smaller more specialist players in the market. Generally the bigger the company the worse the service, with the exception of Standard Life.”

He thinks the only way that providers will boost customer service is if IFAs take their business elsewhere and he has already put this plan into practice. He says: “If there is poor customer service, it puts us off directing business their way.”

He believes that not enough intermediaries rate service over cost and says IFAs risk losing clients if they continue to use providers with poor admin.

“That is why I would stop using certain companies because I am not prepared to risk damaging the client relationship. If providers start seeing business levels drop on the back of complaints of bad service then they will do something about it,” he says.

Bestinvest mortgage manager Peter O’Donovan illustrates his frustration at providers’ poor phone services with an example from Abbey. After being on hold to the company for over an hour, Bestinvest sent in its phone bill, asking Abbey to pay because the firm had spent so much time on the phone to the company. Abbey did respond with a concerned phone call but did not pay the bill.

O’Donovan says he will not be sending any more cases to Abbey and is waiting to see how effective its 10-day service commitment for mortgage applications will be.

Abbey media relations executive for mortgages Joe Wiggins claims the company’s service has improved greatly in the past few months and, since the launch of its 10-day service commitment in mid-July, he says the company has hit its targets.

In response to Chadborn’s comment about bigger firms being worse, Wiggins says: “I would refute that. Just because we are a big lender, it does not mean we cannot offer great service. We are the first major lender to put in place a commitment like this, to stick our necks out and say we guarantee we will get things back to you within 10 days.

“We recognise that in the past our service has perhaps not been as good as we would like it to be which is why we are making sure that we overhaul the service now and get it right.”

Norwich Union director of distribution David Barral says the company was disappointed with the results of the survey which gave it an overall scoring of 4.7 out of 10, leaving it second from the bottom but he claims NU sees it as a tremendous opportunity to improve its service and, if it is done correctly, it could increase business by as much as 25 per cent.

The company is investing £180m this year to improve its systems and processes, which Barral says will “greatly improve” the adviser service experience. “We cannot wave away our legacy with a magic wand but we are systematically working our way through these issues and we are confident that over time the whole experience will improve for advisers and clients,” he says.

Cobalt Capital director Andrew Montlake says if there has been an improve-ment in admin, it is very slight as he has not noticed any changes and agrees with Chadborn that the bigger the company is, the worse the service they provide.

An issue that all three IFAs raise is the lack of individual ownership of cases. Montlake says: “It tends to work best if individuals in a call centre take personal ownership of a case rather than doing a little bit and passing it on. That is where problems occur.”

But Chadborn says this method is a thing of the past. “Norwich Union used to do it and they were the last ones. A big proportion of our pension transfer business used to go their way for that reason almost alone. With complicated transactions like personal pension transfers you need to be able to speak to someone who knows what is going on.”

Montlake cites BM Solutions as one of the best providers, saying its premier mortgage desk always gets back to advisers within an hour, answers the phone within three rings and processes applications speedily. But Woolwich is cited by both Montlake and O’Donovan as “appalling” and Montlake considers Mortgage Express aspoor.

Outsourced Professional Administration Ltd aims to tackle some of the service issues that IFAs experience. Client solutions director Tony Collins says it is all about speeding up the processing of applications. “The service experience can be at best described as neutral in a lot of companies. We have always tended to build very fast, targeted service to allow advisers to do the things they do as fast as possible,” he says.

Collins thinks the problem is that businesses are still very paper-driven. Opal, whose clients include Abbey, Prudential (products only) and Natwest Life, are looking at automated protection underwriting to speed up service, which Collins says are expert systems that ask the right questions. He says in many cases systems in general have not changed for the past 20 years and badly need updating but he is optimistic that this will happen in the near future.


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