Consumers are unlikely to stop seeking advice in the wake of findings from the Financial Services Royal Commission if they already have a trusted relationship with an adviser, according to new research released by MetLife Australia.
The research, titled MetLife Adviser-Client Relationship Report 2018, examined the attitudes of consumers and small to medium enterprise (SME) in regards to purchasing life insurance through a financial adviser, and surveyed people who use an adviser, are considering using an adviser in the next two years and and SMEs with up to 20 employees.
In doing so, MetLife Australia found that, when asked about the Royal Commission, 56 per cent of consumers and 37 per cent of SMEs stated the findings would not change their advice relationship, while 20 per cent of advised consumers reported they were more likely to visit their financial adviser.
MetLife Australia Head of Retail Sales, Matt Lippiatt said the survey picked up on the Commission’s focus on the need for quality advice, as well as its appeal to consumers.
“Given that as many as four in 10 consumers and SMEs have been with their adviser for more than five years, it seems that many clients have established a high level of trust and confidence in their adviser’s integrity and abilities,” Lippiatt said.
He added that MetLife also questioned survey respondents as to what were the key attributes they sought in an adviser with honesty, trustworthiness, transparency and experience ranking highly across all three groups.
“Across the board, consumers and SMEs want to establish a genuine relationship with a financial adviser they can trust,” he said, adding, “They clearly value the adviser who goes the extra mile to listen to them, understand their needs, and communicate regularly and clearly.
The research also found a high level of satisfaction with the service they receive from their adviser with 61 per cent of consumers and 59 per cent of SMEs rating their adviser ‘excellent’ or ‘very good, while only 13 per cent of consumers and 11 per cent of SMEs rate their adviser ‘poor’ or ‘fair’.
“We’ve seen a lot of negativity about financial advice in the media, but consumers and SMEs are both telling us that there are good advisers who are doing a great job,” Lippiatt said, adding the challenge for the financial service sector was to make advice more affordable and accessible.
Most Australians have a 30 second viewpoint on the Royal Commission, as unless it affects them personally, they tend to just get on with their lives.
Matt Lippiatt is correct in that a big challenge for the Financial service sector, is to make advice more affordable and accessible.
A huge percentage of running costs in our Business, is the constant checking and clarification we need to do, to get efficient services, data and information from the Product providers, that is accurate, or does not put at risk, all the work we have done to attain and maintain the client.
For 31 years, I have cringed every time correspondence is sent by the Product providers to our clients, as it creates more work for us.
Consumers want to work with advisers they trust and there is an assumption that the Banks and other large Institutions will automatically do the right thing.
The one thing the Royal Commission has got right, is to show just how bad the big Institutions have been, though the Royal Commission has failed miserably in highlighting that most advisers do a great job and have the trust of the Australian public.
The results of the survey referenced in this article confirm what has been the case all along – established life insurance with the assistance of an adviser was never a problem. And yet, as it has been stated so often, it is the adviser who has been treated so unfairly going back to ASIC’s flawed audit late 2014. The fact that Australians DO trust their adviser is a positive – a message that ASIC needs to somehow recognise! However, trust is not going to help the adviser moving forward. Radical changes/ reversals must be made to LIF or advisers will simply continue to exit this industry!
Correct .. The extraordinarily time consuming levels of constantly changing compliance, resulting alterations to process needed and relative cost to serve before ACTUALLY presenting advice to clients is becoming prohibitive from a business point of view and the main loser will sadly, always be the client.
Those who just legislate without the practical experience of advising just don’t get it!
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