Goodreturns has a piece reporting on Milton Jenning's speech to the LBA - the quotes focus on comments he made about how AFA status enables advisers to differentiate from the service offered by the banks. I don't know if Milton would have agreed with the title "Battling the Banks" - but it's worth thinking about that for a minute.
Do people battle the banks? Do advisers lose business to them? There is no doubt that some do, but is it all one way traffic?
There are advisers that tell me that one of their best sources of business is clients that need a proper review following being sold a package by the bank. For them banks are feeder businesses - doing a great job of sorting out who will buy cover and who won't. The adviser's job is then to sort out who wants a higher level of advice in their risk planning.
There is a life-cycle view which run like this:
- The first insurance people buy is consumer credit insurance, usually alongside a loan for their first car, bought for their first job. Alongside this will be car insurance.
- The second insurance people buy is travel insurance for a trip away, a big trip, the OE perhaps. Often bought by Dad. While flatting they may buy contents cover, but it is rare.
- Which brings us to the third insurance they buy: from the bank, when they buy their house.
Advisers fit in after this.