MLC has welcomed the new financial year with confirmation it has completed the transition to fee for service models for each the advice businesses operating under its umbrella.
From 1 July 2010, the following NAB/MLC-owned dealer groups will now operate under a fee for service model for all new investment and superannuation clients:
These advice groups join Godfrey Pembroke and NAB Financial Planning, who already apply a fee for service business structure for investments, superannuation and retirement planning advice solutions.
… transitioning from a commission based model to fee for service is ‘extremely complicated’
While declaring this transition to be ‘a significant milestone’ in MLC’s history, Executive General Manager MLC Advice & Marketing, Richard Nunn, acknowledged that transitioning from a commission based model to fee for service is ‘extremely complicated’. But Mr Nunn added, “… we have assisted hundreds of advice businesses to transition to fees and not one has converted back to commissions.”
MLC has positioned itself as a leader in making the move to fee for service, Mr Nunn commenting, “We are pleased to see many of our competitors now moving in this direction.” “The sooner our industry makes the transition, the quicker we can start to build greater trust in our industry,” concluded Mr Nunn.
MLC continues to support the retention of commissions for risk products, as outlined in its submission to the Ripoll Inquiry in 2009, which stated:
“MLC believes that it is appropriate for advice commission based remuneration models, with full disclosure requirements, to continue for insurance product distribution.”
