Blog / Wealth Management

At the start of 2013 the UK financial services industry implemented the European Gender Neutral Pricing directive, commonly referred to as ‘G-Day’.

Reading through a report we recently produced on the outcome of G-Day on annuity prices, something struck me.

Prior to G-day, many people had feared that male annuity income would suffer from the new directive. There was a flurry of pre G-Day activity as aware consumers raced to beat the predicted fall. However, nine months later, with cold hard data at our fingertips rather than relying on speculation, we are able to see that while annuity income has improved faster for women, it has also increased significantly for men.

In November 2012, a £50,000 purchase would secure a monthly income of £2,725 for women. On average, this increased to £3,053 in September 2013 – a gain of 12%. For men, the capital amount has seen average income rise from £2,823pm to £3,053pm over the same time period, an 8% increase.

These changes are as a result of improving bond and gilt yields and competition in the marketplace heating up. A trend that few would have predicted late in 2012 ahead of G-Day. It goes to show that no matter how educated the guess, the real facts can only be assessed by the use of data.

In the UK, the financial services industry is still in a period of adapt and evolve from the recent cataclysmic change brought about by the Retail Distribution Review (RDR). Transparency is the new watchword and the regulator is ever alert to ensure firms are adhering not just to the letter but to the spirit of RDR – placing the ‘ethic of care’ at the heart of their dealings with clients.

So how to avoid the stress and time-consuming effort involved in providing the required evidence to the regulator?

Data to help you sleep better

The confidence provided by good data and data management is invaluable. Every firm holds a certain level of information on its clients, so as to ensure that the right clients get the right level of service they have signed up to (and are paying for).  Delivering this via a seamless process which deals with the entire client journey: from quote to application tracking to reporting, transaction histories and wealth reports, and records every client contact point, will enable advisers to provide tangible evidence of the service and value they deliver (to clients and to the regulator).

Data to build the business

Accurate data stored in an easily digestible format that can be interrogated quickly is a very powerful (essential) tool for any business. By having this information at the touch of a button, it allows an adviser to better understand the business mix and to concentrate marketing and promotional activities on areas of growth, nurture or maintenance.

There is much talk now of ‘advice’ and the ‘adviser’ replacing the product. There is certainly a need for advisers to demonstrate value to the client.  There is also pressure to balance the ever increasing administrative burden with the need to free up enough time to generate fee paying business.  A big ask, maybe, but by making effective use of available technology and data, it is perhaps not an insurmountable challenge.

Investing in the right tools for your advice business will provide capability and confidence that your business is compliant and prepared for the opportunities ahead.

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