According to PA research, 66% of advisers polled said they did not recommend unit linked guarantees. Why do you think this is and what can be done to increase the number of advisers recommending the product?
The main reasons given in the survey by these advisers are that they don’t understand the products or that they perceive them as too complicated or too expensive. However, the 34% who are recommending unit-linked guarantee products (ULGs) are no longer talking about product complexity, although they would like to see simpler marketing material.
This suggests to me that, so far, ULG providers have not been successful in engaging effectively with the remaining 66% to get them understanding the products and comfortable with the arguments.
We’ve found that face to face contact with advisers helps enormously when describing the increasing consumer need for stability and certainty of future income while retaining growth potential and flexibility, and explaining about the benefits and solutions that unit-linked guarantees can offer here. So I believe it’s mainly a contact and education issue.
Clearly, the current business environment makes it challenging to support personal face to face contact with every adviser, so we have to find alternatives. Training seminars provide an opportunity to get the story across but other innovative approaches are also possible. AEGON has recently launched on its website a series of four educational videos, as well as a number of online tools, to help advisers learn more about the growing customer need and the role of guarantees.
These can be accessed at http://www.aegon.co.uk/static/guarantees/index.html. Hopefully through greater market education we can increase the proportion of IFAs recommending these products.
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