Whether justified or not, the insurance industry is regarded with a degree
of caut ion and mistrust by many of our customers and this applies to
providers and intermediaries.
Such mistrust is neither good for the consumer, whom it discourages from
making the kind of financial provision they will need for the long term,
nor for our businesses.
We are all familiar with the problems which have led us here – they have
been covered extensively in Money Marketing and other papers. The question
is, what we do about it?
The Saltr (Savings and Long Term Risk) initiative is the industry's
attempt to answer that question. It aims to improve the image and standing
of the industry in the eyes of all our audiences, whether consumers, the
media, the Government or the regulators.
The ultimate objective is, by fostering increased confidence, to grow the
overall market for long-term insurance products.
We cannot achieve this through a simple image makeover. That would
certainly not have secured the support of the industry, including the major
players which have sponsored the project from the outset, nor the IFA
community with whom we have been working to ensure the initiative is
It would have been roundly criticised, and rightly, by the Government, the
FSA and consumer groups if it were seen simply as a bit of spin.
Instead, Saltr aims to raise, and be seen to raise, industry standards in
a range of key areas which research tells us customers value – clarity and
comparability of information, appropriateness of products purchased and
These new standards will provide real benefits to the consumer. They will
disallow opaque charging structures, require providers to set out their
product details and costs in a clear and directly comparable way and encour
age companies to focus on customer satisfaction with service.
Every standard is being developed in the light of consultation with
providers, IFAs, the Government, the FSA, consumer groups and consumers
The standards will not favour any one distribut ion channel.
Saltr's IFA taskforce, chaired by Aifa director general Paul Smee, is
looking at the way the IFA/provider relationship can work best in a Saltr
More work is needed before the standards will be finalised but we are
confident we are on the right track. Consumer research shows that providers
who adhere to these standards, and the IFAs which sell their products,
should enjoy real market benefits.
Saltr's Industry Standards Group, which is made up of representative
companies from all sectors of the industry, is consulting on the standards.
But, for the project to work and consumer confidence to be boosted, the
standards need to be administered by an independent body.
We are, therefore, establishing the Pensions, Protection and Investments
Accreditation Board (PPIAB) which will accredit providers by awarding a new
quality mark at the brand level which companies meeting the standards can
display on their product literature.
The PPIAB will also monitor ongoing compliance. We hope shortly to
announce the name of the chairman and I am confident the body will become a
strong, independent voice, helping to raise standards across our industry.
Saltr will only work if it enjoys the support of providers and
intermediaries alike and we are determined to listen and respond to
concerns and comments from all parties. Our aim is to finalise the
standards by the summer and for the PPIAB to be open for accreditation
business later this year. That is a tight timetable but we are well on
course. The prize – a better deal for customers and a bigger market for the
ind ustry – is one I hope we can all share.