As my regular two week Christmas break looms large on the horizon, I am inevitably drawn into a period of reflection on the year that has nearly past. Ask anyone if business has been good in 2006 and they will of course reply in the affirmative (don't they always?).
As far as the protection industry is concerned, I find myself using unusual words like “interesting” to describe the past twelve months. It is not often that you get the words “interesting” and “protection” in the same sentence.
Firstly, we have had two new products from Virgin and Prudential that are completely polarised in their style. As an advocate of products that provide a range of comprehensive features that, with competent advice, can be tailored to clients individual requirements, it is obvious which one I favour. More innovation for 2007 please.
Then we have had the introduction and first implementation of the new ABI critical illness definitions incorporating the much debated future proofing. My concerns of how this was going to be communicated and understood by all relevant parties was born out by the research conducted by Royal Liver and the Exchange which found that over 80% of IFAs were unaware of the imminent changes. Regardless of whose fault this is, all sectors of the protection industry must start communicating better in 2007 if we really want to work towards common goals.
The story of the year for the protection industry has to be the introduction and swift removal of pension term assurance. Even X-Factor winners have had a longer shelf life.
As an adviser who was caught up in the whole A-Day experience and the oxymoron that is pension simplification, PTA was initially confined to the sidelines. Then as the whole debate raged around who should be allowed to advise it (or not advise it – depending on your method of distribution or interpretation of regulation), PTA was heralded as the answer to the ever widening protection gap.
The reality is that we did not sell more life assurance when we had PTA and we will not sell less now that may not be able to sell it. However, the government’s A1 example of how not to apply joined-up thinking will be another nail in the coffin of consumer and adviser confidence. If nothing else, it prompted rare enthusiasm for discussing life assurance.
Apart from the mad panic in clearing the tower of work on my desk before the Christmas parties start, all that is left now is to write my letter to Santa.
Peter Chadborn is principal at CBK.
The views expressed are those of the author and not those of the company he represents.IFAonline
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