Zurich Financial Services Australia’s Risk Adviser Sentiment Index – compiled off the back of a survey of “202 advisers active in the life risk market” and conducted by Beaton Research and Consulting – found “plunging adviser confidence” across a range of key measures.
Confidence about the regulatory environment is down 14 per cent, alongside more negative appraisals of the “long-term viability of advice practices” (down 11.6 per cent) and a less positive “short-term sales outlook” (down 10.1 per cent).
In addition, one in ten respondents drew a direct link between practice profits and “reputational damage” endured over the past year, with a number pointing to 10 per cent slides in revenue.
However, Zurich general manager, retail life and investments, Philip Kewin reminded advisers that client engagement and satisfaction figures remain high, despite the fact that “negative perceptions are still dominant in the overall community”.
“In the rush to focus on the implications for adviser remuneration, most people have overlooked the fact that the ASIC report was in fact very pro-advice and very supportive of the role advisers play in delivering outcomes for their customers and the community overall,” Mr Kewin said.
“Zurich’s response therefore is to accentuate the positives, and focus on the ways we can partner with advisers to improve the quality and accessibility of advice.”
Driving profitability and a conflict-free client experience will be key themes of the upcoming ifa Business Strategy Day. For more information visit http://www.businessstrategyday.com.au/
Edward, apologies if you took offence, but if you are making 3-4 contacts per year and providing service above and beyond what they ask as you stated, then something else is VERY wrong if your revenue is still down 15%… I think you may be beyond seeking guidance from this forum, get a professional business coach in to evaluate your entire business top to bottom. Good ones will pay for themselves 10 times over.
What needs to happen is for the regulators and other regulation infested entities to have a good look at the industry and FoFA currently and then forecast 10 years ahead. Costs are only going up with duplication of processes, most of which is unnecessary and certainly not valued by the consumer.
We need to remove SOAs for smaller or less complicated investments and risk advice, relying more on the advisers education and experience. You know, how a professional should be treated. Consumers will turn off their fees even if your “great” service is just too costly to bear. The younger generation coming through will not pay for red tape.
Thanks for all the feedback on my comment however I think many of you are shooting first and asking questions later. I did say that “despite our best efforts” which means contacting the client 3-4 times per year and providing them with service above and beyond that they ask. So please don’t make inaccurate assumptions of what our business does (or doesn’t do) when you have no idea!
I was asking for suggestions from industry peers not a trial and conviction of what YOU all think we havent done!
Edward, I have suggestion for you – Multi level marketing, you know Amway.
Sounds ideal for you mate. Google it. Go do it. Give up on this financial planning thing. You could be 30% down this time next year. Bye bye.
Edward….? What are you thinking. How about instead of your “best efforts” you actually deliver service. Clients arent paying for your ‘best efforts’, they are paying for actual service and advice. I actively encourage clients to turn off my fees if at any time they do not feel they are getting value, but none have in 4 years (since I’ve been in this business) as we over-deliver on their service expectations. If your ‘best efforts’ are not enough, hire more staff or reduce your book size. Planners like yourself who charge fees or expect to receive fees without delivering value for them are why our industry isn’t a trusted profession.
Edward you sound like exactly what is wrong with the industry. “That’s the problem with ongoing adviser fees, they can be switched off at any time and you lose the revenue instantly.” Or from a client’s perspective “That’s the benefit of Ongoing adviser fees, they are transparent, and if I am not receiving the service I am paying for I can switch them off immediately”.
Edward, surely the good thing about ongoing adviser fees, is that they can be switched off at any time. I just don’t understand how that is a negative in a free market? Maybe clients are seeking fee for service where they are in control?
In any case, trail is funneled through a product provider but ultimately it’s the client who pays for it. Cut out the middle man and get on with the good advice work that you do.
There will always be a small portion of small businesses going backwards. That’s life. The reason for the drop in sentiment is pretty bloody obvious. The nutcases in Canberra made FDS’s retrospective, so every practice in the country is now forced to duplicate information already provided to clients. Plus the opt-in requirements, which force clients to re-commit to arrangements that have already been agreed upon at least three times previously (FSG, SOA, Apps). On top of all that, ASIC are telling us we have to duplicate all of the work that goes into an SOA by producing another set of documents in the client file. The red tape has become so excessive it is beyond a joke.
Sentiment has probably plummeted as they have slowly come to the realisation that you can only switch insurance policies if it is in the client’s best interest, rather than their own best interest.
My trail book is down 15% since this time last year and it happens despite our best efforts to remain in contact with the client throughout the year.
That’s the problem with ongoing adviser fees, they can be switched off at any time and you lose the revenue instantly.
We need to look at other options here because it is a concern – any suggestions?
Philip please coming from Zurich? accentuate the positives, When Zurich markets a product called agreed value IP, with financial and medical evidence supplied at underwriting, Then Zurich will not honour it, when the insured was one of Zurich,s top 1% of advisers, ThenZurich turmed on them well done Zurich. Like you have a heart, asking for ten years full financials trust deeds etc, Go away Philip your company does not do our industry any justice and nor it policy wording, Zurich who is being investigated for illegal activity in China, Zurich who has executives changing the books to reflect something else. Why would anybody believe you?