Does a commission bias exist in protection?

COMMISSION BIAS

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An offer of extra commission by one provider has raised a question in the insurance industry: should protection have come under RDR after all?

Fairly or not, thanks to a certain FSA-led review the word ‘commission’ has become synonymous with the word ‘bias’. This is because the FSA said it uncovered evidence of investment advisers putting commissions ahead of their clients’ interests before, shortly afterward, announcing its intention to ban commission as a way of remunerating them. The protection market, however, escaped. In September 2010, before it had issued final guidance on its new client-led adviser charging rules, the regulator said advisers selling pure protection products could “continue to do so without having to ...

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