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Strauss: Aviva wrap will tackle mid market

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Aviva is merging its adviser web portal and wrap into a single platform and overhauling its investment proposition with the launch of a number of risk-based solutions.

The company plans to integrate its wrap and web portal into a single platform in a move that will see the new Aviva Platform hold £56bn of assets and have 2.75 million customers, including protection and annuity products. Aviva UK life and pensions chief executive Toby Strauss says the move will make the Aviva Platform the biggest player in the wrap the market.

The majority of the group’s legacy products are held on the Aviva for advisers portal, including individual pensions, investment bonds and endowments. The Aviva wrap only holds around £1bn of assets. Aviva says the integrated platform will also hold 600,000 annuity products and 345,000 protection policies.

Insurers have traditionally steered clear of integrating legacy assets with their platforms due to the complexities involved but Strauss is confident the integration will be a success.

Aviva head of investments Anthony Rafferty says the integration will mean the Aviva Platform will be the only platform allowing advisers “to monitor existing and new business in one place and in one way”.

He says: “It will also have the widest range of products, such as protection products. Around 90 per cent of IFAs advise across all those products and what better than a platform that allows them to monitor all of those products in that one place.”

Strauss says the feedback from IFAs was that they wanted less of a focus on sophisticated tools and more on the ability to transact, produce valuations and trade between funds.

He says other platforms have neglected the middle market, preferring to focus on high-net-worth individuals. He says the £100,000 to £200,000 midmarket client is Aviva’s “heartland client”. He says: “The view is that the mid market have been neglected by wrap platforms as they focus on HNWs and this will allow us to serve them to a greater degree. Every IFA has a number of mid-market customers. It can work in a post-RDR world, whether it is for a restricted, single tie or independent adviser.”

Aviva has also redesigned its investment proposition to underpin the platform, which will offer a self-service proposition for IFAs and one managed by Aviva.

The “managed for you” solution will work from an investment matrix, focusing on client risk and investment timeframe. The company will be launching a raft of manager of managers and target date funds to sit in the proposition later this year.

Strauss says: “In each category there will be one or two options. There will also be the likes of cash funds, gilts as well as with-profits funds due to the guarantees with them to attract investors. It will be a mix of new and existing products with our Aviva multi-manager funds being used.”

Aviva is also set to offer a “managed by you” solution for the wealthier investor, offering IFAs the ability to create and manage portfolios, with over 1,700 funds to choose from.

Strauss says: “The choice is yours on whether you want to manage this yourself or if you want to fire and forget and have these products managed according to the client’s level of risk and the timeframe of the investment.”

He says the full proposition will launch later this year. He says: “The concept of a single view in terms of what you have and what you add as well as the seamless journey from an IPP to a Sipp, with the investment range underpinning it is a big, unique step forward.

“I don’t know anyone else who is doing this and the industry is now looking for more consistency on how investments are managed. Part is through outsourcing to discretionary fund managers and part is through advisers building their own portfolios. Now there is a third way where there are pre-packaged solutions readily available for clients.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. I think there’s a typo in your headline – shouldn’t it read ‘Aviva wrap will baffle mid market’?

  2. If the integration works as well as the stems integration of GA, CU etc etc then it will prove to be one unholy mess.

    Anyway, who would trust to Aviva’s administration capabilities – not me!

  3. I agree with the sntiments above. The proof will be in the pudding as they say. From previous NU/AVIVA experiences, I will not eat anything, (nor fee it to my clients) that AVIVA serves up unless the Beefeater has survived a couple of years after trying the fair on offer!

  4. Unfortunately nether Aviva or Mr Strauss have a good track record in this area so it is impossible to have any confidence whatsoever for this. I still have one client struggling with the first Aviva wrap which Mr Strauss was in charge of.

    Furthermore Aviva are not the only ones that have made a mess of things when they have changed systems of this type.

    This is probably a great idea but with no credible track record it is a masssive gamble. Unfortunately it sounds like clients will be forced to have this gamble on something that is completely untried and untested.

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