Only a limited range of investment and pension-based products will be included in the "menu" commission tables in order to limit consumer confusion about the various remuneration levels as well as limit menu work for the FSA and IFAs, says CP04/03.
Chapter two of Consultation Paper 04/3 Reforming Polarisation: A menu for being open with consumers says consumer research suggests there is a limit as to how much information the client can handle before becoming confused, says the FSA.
Moreover, listing every product would make the menu extremely long and would be difficult and expensive for both the FSA and advisers to maintain if it had to be altered every time a new product was launched or removed in the marketplace.
As a result, it is only when advising on the following products the IFA must issue a copy of the menu:
- Endowments (mortgage and savings)
- Long-term care (regular premium policies)
- Immediate care policies
- Whole of life policies
- Income drawdown
- Personal pensions
- Stakeholder pensions
- Free-standing AVCs
- Pension annuities
- Purchased life annuities
- Investment trust saving schemes (ITSSs)
- Unit trusts
- Unit-lninked bonds (lump sum investments only)
- With-profit bond (lump sum investments only)
- Other bonds (lump sum investments only)
The FSA is seeking feedback on whether the industry agrees with the selection of products and product groups.IFAonline
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