A third of life clients considering changing advisers

New research has revealed that one in three consumers are thinking of changing their financial adviser or stopping seeing a financial adviser altogether over the next 12 months, with the major reasons being cost and lack of communication.

The research, commissioned by major insurer MetLife revealed that 15% per cent of respondents to a survey were thinking of no longer using an adviser while 15% were thinking of changing to another adviser, with 25% citing high fees, while 23% said they did not need advice any more, 23% cited poor communication and lack of contact while 21% cited poor value for money.

The survey analysis said that advisers needed to recognise the findings as a serious call to nurture their relationships and show their expertise to clients through regular contact and reviews.

Related News:

“There are two ways that advisers can easily improve client satisfaction. The first is around building a relationship that is more akin to a partnership, the second is by demonstrating their expertise and providing value on a regular basis,” it said.

“One act that can have a big impact on their clients and be an opportunity for an adviser to demonstrate their care and expertise is a simple annual review,” the survey analysis said.

“Of the 60% of consumers with life insurance who undertook a review with their adviser in the last 12 months, 63% rated their experience as ‘very good’ or ‘excellent’ and 49% modified their insurance cover in line with their stage of life,” it said. “For example, those aged under 35 increased their cover, while those who might be transitioning to retirement reduced theirs. The added value of this engagement with clients is clear. Consumers who have had a review are more likely to be loyal and recommend their adviser to a third party.”




Recommended for you

Author

Comments

Comments

And when they do, they will find most smart advisers wont take them on, as they are not financially viable given all the regulatory red tape required. Within 5 years many of these smaller clients will discover the expensive regulatory "protection" extended to retail clients under FASEA & post the RC has relegated them to a new investment category of "advice untouchables" - that smart advisers cannot afford to service, even if they want to. The number of advisers I am talking to who plan to be gone within 5 years, due to the FASEA education requirements, is astounding. Welcome to the new world of Red Tape, thanks to former & current rocket scientist ministers in this Coalition Govt.

And then when a client in their 30's wants to increase their cover marginally an Adviser will have to do an SOA or ROA which will then mean looking further into their circumstances under FASEA code, then full application, underwriting, follow ups etc. After all that the Adviser is now sitting at a loss... Red tape at its finest.

We send a completed pre-assessment form to the underwriters now. It they come back with a big no, we don't even waste our time doing the red-tape SoA etc. No laws about that. Fed Govt imposed regulatory burdens mean we have no option but to screen out the untouchables now, unfortunately. The consumer lobby can take responsibility for this now.

That's a good tip Steve. No point wasting everyone's time if the client won't get insured and the adviser won't get paid.

Although if you were part of the anti insurance commission brigade you would do the work anyway and then invoice the client for your time. Under that model the client still won't get insured, but the adviser DOES get paid. Those advisers seem to believe that not using the commission system gives them absolution for being unethical.

You're right, an oncologist should offer free testing to all patients knowing he/she can make bank on the % of patients that are diagnosed and need treatment/qualify, better yet, product implementation with a commission attached so no one pays (lol). If a service is offered for free someone is subsidising it.

If the Govt shut down medicare a lot of doctors & oncologists would go broke. Fact.

True, but my point is people are more than happy to pay for a service/advice event if it doesn't result in their desired outcome that's out of the advisers control and is more prevalent in capitalism than not so confuses me why lifies think that it's different for them. I can only imagine it's a communication deficiency where they haven't identified the need to the client enough that the client WANTS/NEEDS the need to be filled and prepared to endure pain (from their wallet) to try and get it. I don't ask for a refund if the physio can't fix my injury after them providing a treatment based on their expertise that could have resulted in a positive result.

I do acknowledge that there's a conflict where FFS advisers to the best of their ability should be able to transparently let the client know their opinion and possible outcomes prior to the client agreeing. Sometimes there's horror cases where an adviser may well know there's not hope of cover so of course shouldn't charge a client giving the impression an outcome is likely. Back to the physio analogy, that's like a physio quoting a quadriplegic that they have all of the answers and is very possible could improve their situation when isn't the reality and likely just creating revenue.

Most medical specialists do operate pretty much according to this model. They have a low consultation fee to sift out those who need (and are willing to pay for) specialised treatment, from those who don't. Then they have a much higher treatment/surgery fee for that subset of patients who progress to specialised treatment.

Yes, the industry is becoming full of people who confuse writing Statements of Advice with providing a service to clients, when in reality its a compliance issue. Clients want to make money, earn an income, or insure their risks. Everything else is simply red tape, which has made advice unaffordable for most.

yep.. tell them to go to their industry fund or big bank.. you will certainly get better personal service with these institutions!???

Unbelievable from another one of the FSC members who have been hitting existing customers with increases since the LIF was passed but now its advisers at fault yet again.
Metlife and the rest of them need to understand that its unprofitable to write business and 99% of advisers I know (including me) will be getting out within the next 5 years.

realistically it's probably a good thing a lot of these lifeys are leaving. Sat back for years earning fat commissions and did nothing. Easily replaced by Robo Advice or a monkey

that monkey comment was obviously written by someone who has never written a life policy, and by an adviser who is probably over-charging their clients $10,000 a year in 'ADVICE' fees, when $1,500 a year would be more in line with the work involved.

Really Fred? I never knew it was that easy. If robo does not work, can everyone come to you and you will say sorry, you were wrong?

Add new comment