He said: “There is no such thing as a perfect policy out there and unless you know the whole market and review all policies, you can’t give best advice. Unfortunately network members often claim to be independent when they should say they are multi-tied, so it’s misleading for clients.”
Some networks also upset protection experts by issuing guidance on what is and is not acceptable advice for different client groups on using approaches such as decreasing term, accelerated CI cover or joint life policies.
Kevin Carr, chief executive of consultancy Protection Review, said: “During our independent training sessions numerous advisers have told us about the latest guidance notes from their network on protection sales, and some of this seems to be completely conflicting with the guidance we provide. There are, for example, lots of reasons for couples to avoid joint life policies and instead recommend single life plans which, generally speaking, represent much better value for money. But some networks apparently disagree.”
The networks point out that advisers can go off-panel if they choose but the process can be fairly arduous. For example for a Tenet Group network member to do so, the adviser must justify why the client’s needs cannot be met by the existing panel and how the alternative product they wish to recommend does. Such cases are approved or declined on a case-by-case basis and those approved are reviewed regularly.
There is, however, no guarantee that most advisers would seek to go off-panel when appropriate, even if the process was much easier. Interestingly the Openwork network is unusual in enabling advisers who want to take this route simply to refer to 2Plan, a Leeds-based IFA that it owns. A 2Plan adviser will then conduct a full whole of market sales process on the network member’s behalf. In practice, however, little use is made of the facility.
Of perhaps greater concern is the fact that some networks are understood to require providers to pay them significant amounts for the privilege of being on their panels – not least because this could exclude smaller players such as friendly societies which might not be able to afford the cost.
As both the FYB and Tenet Group networks are able to state that they do not require such payment, it is no surprise that their members seem keener than others to volunteer opinions on this thorny subject.
