ABI: Time to improve consumer access to simple and effective financial advice

ABI: Time to improve consumer access to simple and effective financial advice

ABI: Time to improve consumer access to simple and effective financial advice

The ABI has today launched proposals designed to give more consumers better access to simple and affordable financial advice.

The policy paper, ‘Increasing consumer access to advice,’ reaffirms the ABI’s support for the aims of the FSA’s Retail Distribution Review (RDR). It also warns of the real danger that the RDR may end up restricting consumer access to advice, and calls for the introduction of a simplified advice process.

Maggie Craig, the ABI’s Director of Life & Savings, said:

“Every consumer should have access to affordable, credible financial advice. We know consumers prefer to get advice when buying financial products, yet our research shows that full advice costs £670 in total, and is beyond the reach of two-thirds of the UK adult population.

“While there are barriers to providing simplified advice, they can and must be overcome. We look forward to continuing to work with the FSA to help firms develop these simplified advice services and offer them to consumers.”

Research featured in the paper also shows that consumers want simplified advice that delivers good outcomes. The potential benefits of this include:

. Faster and more affordable advice for consumers with straightforward needs who are unable to access full financial advice. A simplified advice process could provide a personal recommendation in just 30-45 minutes
. The process is automated and IT driven allowing it to be offered via the internet, over the phone or face-to-face using facilitators to guide consumers through the pre-determined questions.

The ABI and insurance industry has developed guiding principles on how a simplified advice process could work. At the policy paper’s launch, the ABI also expressed its willingness to work with the FSA and other stakeholders on taking its proposals forward.

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Notes for Editors

1. Enquiries to:

Erfan Hussain 020 7216 7411 (Mobile: 07712 841 184)
Kelly Ostler-Coyle 020 7216 7415 (Mobile: 07968 364 302)
Nicholas Burke 020 7216 7392 (Mobile: 07725 245 841)
Malcolm Tarling 020 7216 7410 (Mobile: 07776 147 667)

2. The ABI is the voice of the insurance and investment industry. Its members constitute over 90 per cent of the insurance market in the UK and 20 per cent across the EU. They control assets equivalent to a quarter of the UK’s capital. They are the risk managers of the UK’s economy and society. Through the ABI their voice is heard in Government and in public debate on insurance, savings and investment matters.

3. Increasing consumer access to advice is available to download at: www.abi.org.uk/Publications

4. An ISDN line is available for broadcasts.

5. More news and information from the ABI is available on our web site, www.abi.org.uk