Financial advisors' views on technology 2008: Industry Research Report

Financial advisors' views on technology 2008

Published Date: June 2008

Published By: Datamonitor

Page Count: 161

Order Code: R313-33525

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DATAMONITOR VIEW
CATALYST
SUMMARY
ANALYSIS: The financial advice survey tracks the main changes in advisor opinion each quarter; Financial advisors have a particularly positive view towards Standard Life, Legal & General, Aviva and Scottish Equitable as life companies; Financial advisors are dealing less with Skandia because its products don't match the business models of IFAs; Friends Provident revealed a £46m loss in 2007, and has made job cuts, lost its finance director and is at the center of takeover speculation; A small percentage of IFAs will not work with some insurance providers because of a negative experience in the past; Aviva and Abbey are viewed more negatively by IFAs than other life companies; Financial advisors have a particularly positive view towards Fidelity, Invesco and Jupiter as mutual fund providers.; Invesco Perpetual is one of the largest independent asset management companies in the UK; Fidelity is popular but recent research shows their UK fund underperforming; The Jupiter Group has received more than 120 awards over the past four years; Some large life companies have low online penetration but others are winning; The providers most used for online services are Legal & General, Norwich Union and Friends Provident; Legal & General, Norwich Union and Friends Provident are more popular as providers of online services because they are more actively promoting their online services; IFAs favor applications over enquiries when conducting online business; The majority of IFAs conduct less than 25% of their new business through online systems.; The internet is widely used by UK households to enquire about financial services; Bond and protection applications are the most favored online business for IFAs; Bonds applications are less dependent on individual data capture; IFAs do not apply online for bonds because they find it easier to complete applications offline; Some types of protection application are more formulaic and therefore more easily conducted online; Just 37% of all pensions applications made by IFAs over the last six months have been online; SIPP products and their customers are more suited to online applications than standard pensions; Technology and communications are pivotal in the development of the SIPP market; Towards a more simplified future UK pension market?; New business tracking enquiries are more popular online than policy enquiries; IFAs are still not convinced that their new business tracking enquiries can be answered online; Policy enquiries are the least favored online activity with IFAs believing that they can get better quality information over the telephone; IFAs do not show an interest in support services using new technology; Unipass certificates are important tools; IFAs conduct less that 25% of their new policy business online and prefer to deal directly with providers; IFAs are more interested in working directly with providers rather than through fund supermarkets and wrap platforms; Wrap platforms need to have better functionality for IFAs to use them more; Providers need to give more online support to IFAs in a challenging market; Wraps and fund supermarkets are a convenient way for IFAs to manage their client business; Fund supermarkets already operate some elements of wrap; Life and pensions providers have the scale to launch and develop Wrap; Wrap should be viewed and sold as a new distribution channel rather than as a product; Providers or fund supermarkets offering Wrap technology need to pay attention to the needs of IFAs for successful distribution in the intermediary market
APPENDIX: Definitions; Data; Bibliography; Methodology; Further reading; Ask the analyst; Datamonitor consulting; Disclaimer
List of Tables: Table 1: Which of the following statements best describes your attitude to these providers?; Table 2: Which of the following statements best describes your attitude to these insurers? Q1 2007; Table 3: Which of the following statements best describes your attitude to these mutual fund providers?; Table 4: Which of the following statements best describes your attitude to these mutual fund providers? Q1 2007; Table 5: Have you made any of the following applications / enquiries offline or online in the last 6 months?; Table 6: Have you have made a new business tracking enquiry offline instead of online in the last 6 months?; Table 7: Why do you make new business tracking enquiries offline instead of online?; Table 8: Have you made a policy enquiry offline instead of online in the last 6 months?; Table 9: Why have you made policy enquiries offline instead of online in the last 6 months?; Table 10: What type of organization do you work for? Q4 2007; Table 11: What is the average case size of business you deal with?; Table 12: What proportion of your new policy business do you conduct through the following online systems?; Table 13: Have you made a bond application offline instead of online in the last six months?; Table 14: If you have made an offline bond application in the last 6 months, why did you choose to make the bond application offline?; Table 15: Have you made a protection application offline instead of online in the last 6 months?; Table 16: If you made a protection application offline rather than online in the last six months, why did you choose to make the protection application offline rather than online?; Table 17: Have you made a pension application offline instead of online in the last 6 months?; Table 18: If you made a pension application offline rather than online in the last 6 months, why did you choose to make the protection application offline rather than online?; Table 19: SIPP new business is forecast to continue to increase in the pensions market; Table 20: \Were any of the offline pension applications you made in the last 6 months for SIPPs? (Base: those IFAs who have made an offline pension application in the last 6 months.); Table 21: How interested would you be in any of these online services from a product provider?; Table 22: If you conduct less than 25% of your business thorough a wrap platform, which online services attract you to a wrap platform?; Table 23: To what extent do you agree with each statement?
List of Figures: Figure 1: Financial Advisors have a particularly favorable attitude towards Standard Life and Legal & General as insurance product providers; Figure 2: Some life companies are less highly regarded than in Q1 2007; Figure 3: A small percentage of IFAs will not work with some insurance providers because of a negative experience in the past; Figure 4: Financial advisors are most impressed by Fidelity, Invesco and Jupiter as mutual fund providers; Figure 5: A small percentage of IFAs will not work with some mutual fund providers because of a negative experience in the past; Figure 6: Most mutual fund providers are more highly regarded than in Q1 2007; Figure 7: Some large life companies have low online penetration although others are winning; Figure 8: Bond applications is the favored type of online business for IFAs, with half having made online bond applications during the last six months; Figure 9: The IFA industry is characterized principally by single outlets; Figure 10: The IFA industry is characterized principally by case sizes of less than £5,000; Figure 11: The majority of IFAs conduct less than 25% of their new business through online systems; Figure 12: Half of all bond applications by IFAs are made online; Figure 13: IFAs make bond applications offline because they find it easier than online; Figure 14: Nearly half of all protection applications made by IFAs over the last six months have been online; Figure 15: IFAs make protection applications offline because they find it easier than online; Figure 16: 37% of IFAs have made an online pension application in the last six months; Figure 17: IFAs find pension applications easier to complete offline; Figure 18: SIPP new business is growing and well suited to new technology; Figure 19: 40% of IFAs have made an online SIPP application in the last six months; Figure 20: IFAs prefer to conduct new business tracking enquiries offline rather than online; Figure 21: IFAs are concerned about the quality of information available online when tracking new business; Figure 22: Policy enquires are least likely to be conducted online than other types of IFA business; Figure 23: IFAs believe that they get more reliable information about policies by telephone; Figure 24: IFAs do not show an interest in support services using new technology; Figure 25: IFAs would like more support to better utilize wrap platforms; Figure 26: IFAs think that they get sufficient support from providers, but would like more tools available online

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