A poll, undertaken by The Protection Review, showed 62% said “no” when asked if emerging execution-only adviser business models were a positive development.
Kevin Carr, chief executive of the Protection Review, said: “On the back of some IFAs tying up with an aggregator we felt this was a topical question, especially post-RDR and with firms such as LifeSearch continuing to sign up distributor arrangements on an advised basis.”
He added five years ago the split would have been more likely 20/80 and that mindsets were slowly shifting as the industry became more open to non-advised sales.
Hannah Foxley, owner of advice firm The Women’s Wealth Expert, said for simple term assurance offered on an aggregator site execution-only models were a viable option for advisers.
The firm has partnered with aggregator Payingtoomuch.com and has white-labelled the site’s execution-only capability to sit alongside a full advice service.
Foxley said: “Not all clients want advice and want to pay for it. It is all about choice. Of course high sums assured and more complex cover does need advice.
“But now I can offer my clients general insurance too that I did not offer before, so partnering up with Payingtoomuch.com has really added value.”
Derek Frost, partner principal at the Melia Partnership, said execution-only was “a minefield” and distinguishing between non-advice and some-advice was almost impossible.
He said: “I can see the motivation but there are just too many things – trust issues, underwriting concerns – that can backfire on the adviser and that can mean a consumer buying the wrong cover or not buying at all.
“Call me old-fashioned but it smells of desperation and it taps into the wrong thought process. I have, and never will, support ‘pile them high and slog them cheap’ approaches.”
