Life companies may need to diversify their distribution channels beyond small IFAs to survive the RDR's commission ban, a study by Fitch Ratings concludes.
Banning financial advisers receiving sales-based commissions from insurers represents a "step-change" in how investment advice is paid for in the UK, it says. The resulting shift of some customers away from the IFA sector and towards cheaper, restricted advice will grow the market for non-intermediated sales of simple investment products, giving bancassurers an opportunity to gain market share, the ratings agency says. "Insurers that offer simple investment products through low-cost channels stand to gain from the RDR, while those that are dependent on small adviser firms to sell poli...
To continue reading this article...
Join Professional Adviser for free
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes