Earlier this week, comments from Will Hale of Key Partnerships on the regulatory pitfalls which face advisers who ‘dabble’ in the sector but do not specialise sparked a strong reaction from Age Partnership technical manager Simon Chalk. Chalk described the comments as ‘scaremongering tactics’.
This is certainly an interesting debate and one which I would like to look at from a different angle.
At the risk of being labelled a pedant, this debate does beg another question: what defines a dabbler?
The FSA coined the phrase ‘dabbler’ some time ago and unfortunately this term has stuck. The dictionary definition of dabble is, “to undertake something superficially or without serious intent”, and hereby lies the crux of the argument.
Just because an adviser is not writing a certain amount of equity release business does not mean they are only dabbling. What’s more, I am unaware of the exact measurement of a dabbler, how much dabbling does a dabbler have to do? All equity release advisers have to start somewhere.
Surely it would be far more dangerous for an adviser to go from a standing start to advising on a number of cases overnight. Equity release advisers have to build up experience, knowledge and the skills required to look after this specialist sector of customers, and this cannot come overnight.
The decision to refer a case is always going to be a feasible option, and for many advisers who recognise that a customer would benefit from equity release but do not have the qualifications to advise themselves, passing their business to a trusted source is not only invaluable, but essential to their clients best outcome.
However, to define a dabbler by the amount of business they write can be misleading. There is absolutely no reason why a qualified adviser who has the necessary skills and systems in place to deal with the process, understanding of the due diligence required cannot deal with a low number of cases and still give excellent advice and service.
True, this may not be the most cost effective way for an adviser to operate, but if their intentions are to build upon this business, then this can be a perfectly reasonable start point.
As an industry, we must now encourage and support new advisers, help them understand the benefits of operating within the equity release market and welcome them with open arms.
Andrea Rozario is chief corporate officer at Bower Retirement Services
