things like unregulated collectives,
investment trusts
and so on; a generally
wider base of investments
above just packaged products,
and that is the kind of
space offshore advisers and
providers have operated in
for quite some time.”
There was also discussion
around the need for a
change in the way life company
sales people would
be incentivised, in order
to align them with IFA and
investor needs in the post-
RDR world. This was owing
to the fact adviser remuneration
would be decreasingly
based on transactions
– necessitating sales targets
for life firms – and more on
assets under management.
It was agreed life offices
would therefore need to
devise incentives for their
staff that took into account
case size and asset growth
within policies.
Clerical Medical International’s
business development
manager Nick
Smith said: “We will have
to look at what tools you
give the salespeople when
they walk into an IFA’s
office and talk around the
proposition. A lot of it is just
going to be solely focused
on the service, the proposition
and the pricing.”
l Advice standards
The roundtable also considered
if providers have a
role to play in improving
standards of advice in markets
in which they operate
outside the UK.
Phil Oxenham, marketing
manager at Skandia
International, said attempting
to impose sets of standards
from one place on
another was difficult and
risky.
“Customers are very different
in different areas;
there are local pressures
and it is about making sure
new business – regular premium
30
25
15
£m 20
10
5
0
’05 ’06 ’07 ’08
*Q1 only. Source: Association of British Insurers
you have the right product
in the right area for those
customers,” he said.
“We have something
like 14 different regulators
around the world who we
deal with, they each have
different requirements and
some of them could even
conflict with UK legislation;
some of them stipulate
certain wording, the
way things are presented
and so on. So you can try
and have strong ethics but
there are other factors that
are beyond your control.”
Dodds said: “After a
while, markets do tend to
follow places that take a
regulatory lead such as the
UK, but it differs from place
to place. For instance, in
Hong Kong there is no
commission disclosure, it
is some way away anyway.
Whether that is coming
new business – single premium
8
4
£bn 6
2
0
’05 ’06 ’07 ’08
*Q1 only. Source: Association of British Insurers
’09*
along now is a hot topic
but yes, it will eventually
seep in but they are quite
different markets. There
may still be niches where
some of the stuff we do for
the RDR for instance might
be perfectly applicable.”
Oxenham added: “You
also have the situation
where UK advisers take the
standards they are used to
into international areas, so
you may see development
in some of those markets
as a result of changes in
the UK.
“There is also the customer
aspect of that too.
Many of them have moved
from the UK so they have
that experience and knowledge
and perhaps a higher
expectation of the standards
they want to see, such
as disclosure and so on.
“So despite local leg-
’09*
feature
islation not always being
exactly where the UK is,
sometimes you do have to
reach that level to meet the
needs of the customer.”
l Commission trends
Blackburn said: “There has
certainly been a shift in the
investments and preferred
options. Last year was very
much about cash and 12month
fixed rates. This
year is much more about
the structured deposits.
“We are mindful of the
kickback available here
though, and on some of
the niche or specialist offshore
funds. We need to
be mindful of an industry
to ensure a consistency of
approach there.”
Mario Ricciardi, executive
director investments
and business development
at Canada Life International,
remarked: “Certainly from
the Isle of Man perspective
and on the investment
side, we work very
closely together, from the
investment sub-committee
through to general daily
emails with issues on funds
and so forth.
“I do have a concern
that banks are cottoning
on to a new IFA distribution
route, paying marketing
allowance and commissions
on structured
deposits. It is another route
to an IFA getting double
commission.”
Leeson said Prudential
forbade such marketing
allowances, when
it was aware of them.
Royal London 360º’s Alan
Blackburn said they were
permitted but clients were
made to sign declarations
to the effect they knew
their adviser was being
paid such commissions.
He added: “There are
some bespoke structured
deposits put together for
offshore life companies, and
alan Blackburn, head of uK
sales, Royal london 360˚
Peter Dodds, head of marketing,
Friends Provident international
Margaret Jago, international
technical manager, aegon Sei
Richard leeson, head of
business development,
Prudential international
AuguST 2009 [www.international-adviser.com] INTERNATIONAL ADVISER
15
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