View more on these topics

Sun Life Financial to axe future trail commission

Sun Life Financial 480

Sun Life Financial of Canada will stop paying advisers commission on existing business from next year following a review of its closed book of business.

The company, which closed to new business in the UK in December 2010, wrote to advisers last week offering them a non-negotiable lump sum in lieu of future commission payments.

The letter, seen by Money Marketing, says: “We have made the difficult decision that we will not pay any further commission on our policies, excluding i2Live policies, with effect from December 31, 2012. Instead we intend paying you a lump sum between January and March 2013.”

I2Live policies were the variable annuity product offered by the UK arm of Lincoln National Corportaion, which Sun Life Financial acquired in June 2009.

The lump sum is based on policies remaining premium paying until the policy maturity, expiry or vesting date, or June 30, 2017, whichever is earlier.

A Sun Life Financial spokesman says: “We are simply offering to vary the contract by paying the current present value of future commission early, calculated over four and a half years.”

Highclere Financial Services partner Alan Lakey says: “Clearly Sun Life Financial is not looking for new business and therefore it does not care if it upsets advisers.”

But Tower Hill Associates director John Lang says: “It is entirely reasonable to offer a lump sum in lieu of future commission. It will be intriguing to see if bigger players decide to follow suit, though I do not think that is likely.”

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com