There are lots of inequities of the Ombudsman scheme. Whilst without question a system needs to be in place it can seem to be a lottery.
If you filled Lords Cricket Ground to capacity with IFA clients, only one spectator would have a successful FOS claim this year.
Getting some of the facts is easy but trying to compare them to the market is the difficult part. According to statistics from the Association of British Insurer’s 75% of long term products are advised by advisers. That in itself is 30 million policies. This is the low end of the market. The adviser percentage of non-insurance based, mostly investment products, is even higher.
Despite advisers having over 75% of the advice market FOS receives only five cases in every 1,000 from the sector and of these five, they only uphold two.
This is certainly good news. The bad news is that, in spite of the numbers, the burden is still spread across the industry to cover the annual FCA fee of £77 million. It is obvious that the sums paid out by the IFA sector to fund the FCA, the FOS and the FSCS are totally disproportionate to those paid by the banks and the providers, especially when the figures clearly show the sector is incredibly low risk when compared to the others.
Ultimately, of course, it is you the consumer who pays. If only the IFA sector was recognised by the regulator as being the best source of good advice and actively promoted as such to the consumer, it would go some way to balancing the books.
New and prospective clients are often nervous about the advice process and until they have sat down and discussed their circumstances can they put a value against the advice they are given
It is not daunting but at the first meeting it is an opportunity to discuss your needs and until paperwork is signed you are not committed to pay for any work undertaken. We do not proceed with anything without your agreement.