New research released today has identified how Aussies feel about financial advice in the wake of scandalous revelations from the Hayne royal commission.
Honesty and trustworthiness are the top attributes consumers and small business owners look for in a financial adviser, according to new research released today by MetLife Australia.
The report found that those who have established trusted relationships with their adviser say the royal commission will have no impact on their advice relationship.
The MetLife Adviser-Client Relationship Report 2018 examines consumer and small to medium enterprise (SME) attitudes to purchasing life insurance through an adviser, based on a survey of consumers who currently use an adviser, consumers considering seeing an adviser in the next two years, and SMEs with up to 20 employees.
MetLife Australia head of retail sales Matt Lippiatt said there were marked similarities between all three groups.
“Across the board, consumers and SMEs want to establish a genuine relationship with a financial adviser they can trust,” he said. “They clearly value the adviser who goes the extra mile to listen to them, understand their needs and communicate regularly and clearly.”
Transparency and experience also rank as key reasons for selecting an adviser. Once the adviser-client relationship has been established, consumer and SME clients expect their adviser to genuinely care about them, speak to them in easy to understand language, and maintain that honesty and trustworthiness.
MetLife also examined consumer and SME attitudes to the Hayne inquiry, which has generated plenty of negative press for some advisers.
When asked about the royal commission, just over half of consumers (56 per cent) and over a third of SMEs (37 per cent) said it would have no impact on their advice relationship. Further, 38 per cent of SMEs and 20 per cent of advised consumers said it would make them even more likely to visit their financial adviser.
“What’s clear from these numbers is that the royal commission has put the spotlight on the need for quality advice and its enduring appeal,” Mr Lippiatt said.
“Given that as many as four in 10 consumers and SMEs have been with their adviser for more than five years, it seems that many clients have established a high level of trust and confidence in their adviser’s integrity and abilities.”
Overall, the MetLife research data shows that Australians are reasonably happy with the service they’re receiving from their financial adviser, with 61 per cent of consumers and 59 per cent of SMEs rating their adviser ‘excellent’ or ‘very good’. Just 13 per cent of consumers and 11 per cent of SMEs rate their adviser ‘poor’ or ‘fair’.
“We’ve seen a lot of negativity about financial advice in the media, but consumers and SMEs are both telling us that there are good advisers who are doing a great job,” Mr Lippiatt said.
“However, given that the majority of Australians currently don’t have an adviser, the challenge for us as an industry is to make financial advice more affordable and accessible to the people who need it.”
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