The FSA’s long-awaited publication of the retail distribution review rules for legacy products finally makes it possible for advisers to get seriously into the detail of their adviser charging transition plans. It will also doubtless see an increased amount of activity from provider firms looking to help IFAs with this activity.
Such support was recently identified to me by Graeme Bold, UK retail director at Standard Life, as a key part of his company’s plans for the next few months.
Standard Life has been running a programme of seminars and dinners to bring together adviser firms that have made different levels of progress ahead of the RDR, enabling those who are advanced in their plans to share thinking and experiences with other advisers who have made less headway. The company is now keen to ensure advisers are ready to trade profitably in the new world.
Previous activity has high-lighted a collective mentality from advisers, with firms demonstrating a keen sense of community and a willing-ness to help their peers. There is an industry-wide desire to deliver the best advice and service to clients.
Now there is greater clarity over legacy business, broker consultants will be turning their attention to helping IFAs in their detailed transition planning, looking particularly at service costs and how to effectively support those customers whom it is no longer economically viable to offer face-to-face advice.
A further range of material is being developed to help advisers reduce costs. None of this material is prescriptive but it will help advisers take more control of their RDR planning process.
Standard Life Investments has developed a learning gateway hub to help those advisers who have passed their exams but still need to address gap-fill issues.
Bold believes the move to the RDR is just a further evolution of the direction Standard Life has been taking for some time, pointing out that the business has operated Sipps, offshore bonds and Isa products with perfect matching style deductions since 2004.
Citing the RDR as a significant business opportunity, he says there are three key strands to the Standard Life’s own RDR programme.
The first strand is getting ready internally, which he insists is already well advanced. From the evidence I have seen and the services the company is preparing, this claim seems well founded.
Equally, the business-readiness programme being operated with advisers is essential to ensure the company’s distribution channels are ready.
With these two elements in place, Bold says the business is now increasingly focusing on how it can capitalise on the opportunities the RDR delivers.
A new packaged product range is apparently to be launched in the fourth quarter of this year and the company will be communicating details of these products to advisers well in advance.
Standard Life also says many of the features on wrap will work well after the RDR, although some changes will be made in advance. A considerable development budget has been allocated to the wrap service and there has been a constant stream of upgrades in recent months.
A new range of client reports for advisers was launched in July 2011. These allow advisers to build their own reports and design a bespoke suite of documents. The new features within the service include the ability to create either a one-page summary or a detailed report. These can be run either by product level or asset class, with the facility to pick and mix products on the product view.
Both composite and individual reports can be created and the former allows the adviser to generate a single document that includes one or more different reports.
This composite document can include information from a client review or look at factors such as performance, valuations, cash and investment transactions or client risk profile. They can also present a house view, report glossary and investment guide.
The account view can present either wrap, product or multi-product level perspectives, with the product view able to show one or more sub-accounts. These can also include or exclude target allocations both within the client review and the performance report.
Significant additional developments were added in February this year with the delivery of Standard Life’s Isa subscriptions report, an adviser dealing report, adviser remuneration and investment charges reports as well as a further refined performance report. Further significant functionality will be delivered over the coming months.
Having been one of the first insurers to adopt a hybrid package product and platform strategy now supplemented by its ’adviser plus’ restricted advice proposition, as well as its separate investment arm and a highly innovative proposition in the workplace savings market, it is evident that Standard Life has a clear proposition for just about every area of the RDR.
Given its scale and financial resources, the company is likely to come out as one of the winners after the RDR, provided it can clearly articulate the benefits of each of these propositions and be both nimble and timely in its delivery.
Ian McKenna is director of the Finance & Technology Research Centre