Jack of All Trades Master of None is a phrase we are probably all familiar with and the recent FCA and industry comments calling for advisers to be able to think in terms of a wider spectrum of retirement advice, while on the face of it appears to be reasonable, is a cause for concern.
The skills, knowledge and expertise needed to advise in equity release, pensions, investments, and increasingly care planning, is extensive and having a deep knowledge and understanding is exactly the reason many advisers decide to specialise in a particular area. As a result the customer has access to tailored, expert advice, while advisers are also expected to have a knowledge of other areas such as the state benefit system.
However, recognising a customer’s need for specialist advice is an essential skill advisers need to have, and working together with other specialists to cater for the customers’ full needs is part and parcel of many advisers’ processes.
The recent calls from the FCA to look into regulation of equity release and its impact on development of the market is in my view positive. Clearly the reputational issue with this sector inevitably deters new entrants – both providers and advisers, but it was for this very reason SHIP was introduced as an industry self-regulator over 20 years ago.
The stringent product safeguards and advisory requirements have helped to clean up the image of equity release. However, back in 2009, SHIP, now the Equity Release Council, conducted comprehensive research with the outcome suggesting that the industry should develop various levels of safeguards over various products, thereby allowing more providers to cater for increasingly diverse needs of a changing customer base.
This, in my opinion, is still the way forward. Some customers do not need the level of safeguards insisted on by industry and other various conditions, this along with regulatory requirements inevitably holds back new providers entering the market. But we must remain cautious and safeguarding the consumer has to be the priority along with choice from a variety of providers. I welcome a cross-industry debate with the FCA which offers everyone a voice, from the provider to the adviser and the solicitors.
