Almost a third of advisers are automatically offering clients a SIPP if they are planning to invest more than a £1,000 a month, says Dunstan Thomas.
A survey of 4,000 advisers carried out by the firm reveals around 79% are already selling SIPPs, with 9% still considering it and 12% convinced SIPPs will not suit their customer-base.
However, while 46% of advisers say they recommend a SIPP to a client if they are “taking a very active interest in his/her pension”, 29% admit to automatically offering SIPPs based on the wealth of their customers, with those investing £1,000 or more each month a key target.
Christopher Read, chairman of Dunstan Thomas, says the findings from the research are interesting as this automation, where advisers are dividing clients up into how wealthy they are, is to some extent taking away the element of advice and making it more of a sales process.
The survey results are also interesting following comments from the FSA just before it took over the regulation of SIPPs in April, in which it warned advisers it would be monitoring the suitability of advice where SIPPs have been recommended over alternative pension products.
In addition, the Dunstan Thomas survey – which was conducted by Matrix Data between 26 April and 4 May – reveals the principle concern of advisers following the regulation of SIPPs on 6 April – ‘Regulation Day’ – is the absorption of professional indemnity (PI) premiums into new SIPP business.
And the firm adds contrary to popular belief the majority of adviser respondents have worked out their strategy for wraps, and have placed it high on their agenda with 48% claiming the growth in wrap platforms is the most significant current trend, while 23% chose self-service through the internet.
Around 16% of respondents have already selected one wrap platform provider, while 40% have picked out two or more, while 16% intend to go with an “as yet unselected wrap provider”, while 18% don’t plan to offer wrap at all, leaving Dunstan Thomas to suggest time is running out for providers still developing their wrap offering.
The survey also reveals 29% of advisers are already using stochastic modelling to help illustrate probable outcomes for their clients, while a further 29% are actively considering it, and 42% believe over time they expect to use the tool for all their customers.
Read says: “The findings bear out what we have been saying over the last year, a growing trend towards SIPPs becoming a major part of providers’ pension product portfolios as well as a major part of many advisers’ growth plans.”
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