Warning that LIF risks the loss of a generation
The financial services industry need to find creative ways to stop mature advisers from prematurely leaving the industry because of the Life Insurance Framework (LIF), according to a new white paper produced by publicly-listed financial services group, ClearView.
The white paper, released this week, pointed to the fact that the advent of the LIF may see many advisers aged in their 50 and 60s exiting the industry and this, in turn, risked ending well-established emotional connections with clients.
It urged dealer groups, professional associations and product manufactures to collectively ensure that mature advisers had access to the right training and tools to meet their obligations and transform their businesses.
Commenting during the launch of the white paper this week, Clearview general manager of distribution, Christopher Blaxland-Walker said the convergence of four major factors threatened to extinguish an entire generation of invaluable knowledge and experience.
He said those factors were digital disruption, remuneration reform under LIF, and stricter education and training requirements.
“Moving into 2017 and beyond, it’s important that there isn’t a repeat of 2004 when the introduction of the Financial Services Reform Act drove out many advisers, both good and bad,” he said.
“FSRA got rid of many unqualified and poorly qualified agents, and rightly so, but in the confusion many competent mature advisers exited too. They weren’t adequately supported to gain the necessary qualifications, adjust their business models and manage the transition.”
Potential solutions raised in the paper include formal and informal mentoring programs that marry experienced advisers and newcomers; and the creation of flexible ‘relationship manager’ roles within manufacturers, licensees and practices, designed specifically for senior advisers and former advisers.
“The current generation of advisers are more educated and technically proficient than any other but they can still learn skills and qualities like empathy and resilience from mature advisers,” Blaxland-Walker said.
“If the industry can successfully close the generation knowledge gap, the result will be a profession that’s mastered the art of winning new clients and building personal relationships, not only business relationships.”
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