According to Air, which surveyed 220 advisers, it found that 86 per cent anticipated making changes to their operations due to Consumer Duty.
However, 17 per cent said they were unprepared for upcoming changes and a further eight per cent said they were unsure of whether they were prepared or not.
Around five per cent of advisers said they didn’t know what changes were being made to Consumer Duty and only 19 per cent said that they felt prepared for the changes.
When asked about the changes they may have to make, around half, 47 per cent, said the way advice is documented would need to change.
Approximately 47 per cent said that they would need to review the customer journey, and just under a third, 29 per cent, said they would need to better assess and document fair value justification of their remuneration.
Over a quarter thought they may need to redefine the metrics they use to measure whether good customer outcomes had been achieved.
The deadline for implementation plans for Consumer Duty was 31 October, and delivery is expected by 31 July 2022 for new and existing products.
The Financial Conduct Authority’s CEO Nikhil Rathi recently said that the regulator had no plan to delay or adjust the timeline for implementation of Consumer Duty.
Stuart Wilson, chairman of Air Club, said the Consumer Duty was the “largest shake up in regulation for years with far reaching effects across all financial services firms”.
He noted that the research showed that the regulation would have a “profound impact” on the later life lending market, but few seemed prepared for this shift.
Wilson added: “While there is no doubt many advisers already have some of the mechanisms and systems in place to prosper in this new world, they should not be complacent. Now is the time to review, road test your approach and ensure that you understand the most current industry thinking on this fundamental change.
“At Air, we are committed to supporting advisers in the later life lending sector by providing the tools and information needed to achieve this. As we approach the implementation deadline, we will be hosting debates as well as webinars to ensure our advisers are as informed and prepared as possible.”
