Service providers win adviser loyalty
Service providers are an essential part of the financial planning sector and, as Jason Spits writes, while advisers may recommended diversification in a portfolio they appear to have strong preferences when it comes to choosing business partners.
Service providers are critical elements to the ongoing work of the planning sector and while some may debate which providers are most essential no planner would hang out a shingle without gaining professional indemnity (PI) insurance.
Of the commercial PI providers CGU was the leading group reported planning groups with 2700 planners (about 18 per cent of the Top 100) covered by the insurers with a further 2270 planners (around 15 per cent) covered by Axis.
Interestingly the level of planners covered by inhouse schemes climbed to 2320 (from 2030 in 2014) or 15.2 per cent of all advisers in the Top 100, up from 2030 planners in 2014.
All the groups choosing to self-insure were licenced by a major bank or Macquarie and represented the bank in its branding with ANZ Financial Planning, Commonwealth Financial Planning, NAB Financial Planning, St George Financial Planning and Westpac Financial Planning all stating they were self-insured.
The data also showed that institutions with multiple planning businesses used a number of PI insurance providers with NAB owned groups using Axis and CGU CBA owned groups using Chubb and CGU and and Westpac owned groups using Vero.
In terms of financial planning software few groups reported using more than one system but those who did were typically non-aligned groups.
Xplan was reported by the most planners (6400 planners) as their main software system followed by Coin (4080 planners) and Midwinter, Adviser Logic and a number of bespoke inhouse systems.
This tendency to use a single supplier was less evident with research houses where planning groups used a range of providers depending on whether they were dealing with investments, superannuation or risk insurance.
Morningstar was the most used research provider for investments with nearly 6000 planners using its services while inhouse research capabilities were the second most reported provide at 3000 planners, with Lonsec providing research services for nearly 2000 planners.
Chantwest figured highly among superannuation research providers with more than 5239 planners using its services while Xplan once again was the preferred supplier for risk insurance research information with 3920 planners using the software. It was followed dedicated risk research providers Dexx&r with 1346 planners and Rice Warner with 990 planners.
Platform usage provided in the Top 100 Survey provided interesting but limited data with only 50 per cent of Top 100 survey respondents volunteering information about their use of platforms in the areas of investments, superannuation and risk.
Not surprisingly, of those groups who did provide data and were institutionally aligned, the leading platform was typically an inhouse product with AMP platforms being used by 3130 planners, BT platforms being used by 1545 planners and NAB/MLC platforms being used by 1475 planners across the total Top 100 Survey.
|
Leading Service Providers |
Use by no. of advisers |
Use by no. of advisers |
|
Professional Indemnity Insurance |
CGU – 2700 |
Axis – 2270 |
|
Financial Planning Software |
Xplan – 6400 |
Coin – 4080 |
|
Research Houses |
Morningstar – 5970 |
Lonsec – 1980 |
|
Platforms |
AMP – 3130 |
BT - 1545 |
See also:
Recommended for you
Money Management’s 2021 TOP Financial Planning Groups survey has confirmed that the number of financial advisers operating under the umbrellas of the largest groups has dropped to new lows, Oksana Patron writes.
Money Management’s 2020 TOP Financial Planning Groups research has confirmed the number of planners working at the biggest groups has dwindled to its lowest levels in years, underscoring the end of the banks’ dominance in wealth management, writes Oksana Patron.
The Money Management TOP Financial Planning Group Survey is the longest running annual snapshot of the leading advice groups in the sector.
The last 12 months caught the financial planning industry in the middle of a transition and struggling to figure out what the new rules of the game will be in a still-evolving post-Royal Commission environment, Oksana Patron writes.
