Standard Life plans to develop a direct-to-consumer offering for less wealthy consumers to capitalise on increasing customer numbers due to auto-enrolment.
Speaking at a media briefing last night in London, Standard Life managing director of adviser and investments Richard Charnock said the death of the bancassurance model and the number of people who would no longer get advice from traditional providers such as banks meant it was “quite obvious providers have now got their eye on the UK advice gap.”
He cited examples of models in the US operated by firms such as Fidelity and Vanguard which managed to bring together workplace, self-serve and advised markets.
Charnock said: “We are under pressure from the Government and the regulator to fill that advice gap, so we will be building something in due course that takes us into that space.”
Asked by Money Marketing how such a model would work given Standard’s Life adviser focus, Charnock stressed the business was an intermediated business and would continue to be.
He said: “This is about capturing the opportunities through auto-enrolment as much as anything else. We are not entirely sure how many auto-enrolees will come through Standard Life over the next three years but it could be as many as 400,000 people in schemes who are becoming customers of Standard Life.
“Through a process we will work out who is advised and who is not, and for those that are not, if there is something that engages them through a self-serve proposition at the lowest level, perhaps selecting an Isa through us, that creates a pool or a franchise if you like that can then be referred over to our IFAs. Suddenly, IFAs that partner with Standard Life can see the benefit of future referral business coming their way.”
Charnock said the company would never go down the advice route itself, and hit out at suggestions that rival provider Aviva was looking at selling to its legacy customers.
He said: “We think that is outrageous, the back book is only with them because it was intermediated and introduced by an IFA. That is certainly not our strategy at all.”