There is some good news for advisers as they ponder the fair value requirements of the Consumer Duty.
Nearly 90% of clients believe the advice they are receiving from firms is good value for money, according to consumer research conducted by The Lang Cat with more than 2000 consumers.
Could the Duty also see changes in practice?
The Protection Distributor Group has suggested that the Consumer Duty will require more consideration in terms of the treatment of beneficiaries.
The PDG chair Neil McCarthy writes: “A fair interpretation from the Consumer Duty requirements would suggest that both distributors and manufacturers must be able to demonstrate they have taken all reasonable steps to protect customers and their beneficiaries from the risks of life cover proceeds not being available to the intended person.”
The PDG wants to see ‘an increased adoption of contractual beneficiary nomination across all protection manufacturers, using similar wording and processes at policy application and on-risk stage’.
It suggests there are very different processes across the industry leading to very different outcomes.
I do think the phrase ‘fair interpretation’ is interesting regarding the duty. The FCA is a little more Delphic except where it has highlighted good and poor practice in its guidance.
Sipp operators have received another Dear CEO letter. There is a long history of such letters, and this feels like something of a restatement – but these are the key harms listed by the FCA in the letter. It’s not been written up yet by the trade websites.
Firm failures causing disruption of service for consumers or transferring additional costs to them (including potentially unauthorised payment charges if a scheme is wound up and assets given to members).
Consumers not receiving fair redress when it is due (or not receiving it in a timely manner), particularly when firms have failed to conduct adequate due diligence.
Pension scams and fraud, as well as consumers being allowed to make investments which should not be accepted in their SIPP, including non-standard assets which fail or become illiquid and lose all or most value.
In Investment Week, acting editor James Baxter-Derrington argues that bond managers must 'unlearn' the past decade of central bank lessons.
The UK saw a 0.1% increase in GDP in Q1 revealing the fragile economic conditions of the country, again covered by Investment Week.
The state pension age will not be raised to 68 until between 2041 and 2043, the work and pensions secretary Mel Stride has said.
The following story all feels unnecessarily hasty.
Aviva is to shut the self investment option in its Executive Pension Plan, giving advisers two months to get in touch before the provider will start selling clients’ assets.
In a letter sent to advisers, seen by FTAdviser, Aviva announced it would be closing the self investment option within clients’ Executive Pension Plan, where securities and property assets are held.
Advisers have suggested that for the roughly 180 investors concerned. They argue that something like six months’ notice would have been more appropriate.
The base rate has risen to 4.5% - and This is Money has done one of its long write ups looking at all the implications with lots of graphs. Always useful.