There’s no doubting social lockdown has meant a reconfiguration of the logistics of advice, limiting client interaction, with an inability to meet face-to-face and the potential for problems to be raised.
Add in the huge economic repercussions being felt right across the land, and you might have potential for greater customer detriment, simply because the signals normally present during face-to-face advice cannot be picked up during an online, telephone or video meeting.
Much has been said about the huge benefits that platforms like Zoom or Microsoft Teams have presented, but there still needs to be a careful approach taken.
This is especially so when it comes to customers who might be vulnerable or suffering duress to move forward with an equity release solution.
Advisers’ sixth sense
One of the benefits of a face-to-face approach is that advisers can often pick up these on client signals or touchpoints.
Take this as an example – a child’s business is suffering because of lockdown and they put pressure on a parent or family member to push ahead with equity release so they might use the cash to prop up that business.
Talking to the individual often draws out such family pressures being brought on them.
Advisers active in equity release, of course, have to consider the family in the process but, during this period in particular, we need to ensure the advice process is robust enough without face-to-face interaction to detect such pressures, vulnerability and duress.
Who is to say that, during a Zoom meeting for example, that a family member is not sitting off camera pressuring the individual to say what they want them to say to get the case through?
It might seem like this requires something of a sixth sense on the part of the adviser but, from my experience, that’s exactly what advisers tend to have. So, what to do?
FCA is watching closely
Well, despite the changes introduced by the Equity Release Council, one of the areas which still remains a predominantly face-to-face part of the process is the legals.
The vast-majority of solicitors still appear to be meeting clients in some form and therefore if the adviser does have these concerns it makes sense to raise them with the solicitor.
This type of situation shows how important client interaction is however, and advisers may well need to provide far more detail in their suitability reports, especially during this economic downturn.
We do not want advisers providing a long-term solution to what may be a short-term problem.
The Financial Conduct Authority (FCA) will be looking very carefully at the advice provided during this period and we need to ensure that, where appropriate, short-term solutions are presented to the client if suitable.
With a greater level of government support available, perhaps this is the better route than equity release?
Overall, advisers will need to be more careful than ever before, ascertaining the true nature of their client’s need for cash and covering all available bases and solutions, not just what product solutions they may be able to access as a specialist in the later life field.