Clients reacting to RDR better than advisers, research suggests

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Research suggests some advisers are struggling to cope with RDR implementation but that clients are largely unfazed by the reforms, with only a minority of clients deciding not to take advice as a result of adviser charging.

NMG Consulting polled 374 advisers in March and April as part of its ongoing work to track the way advisers and consumers are responding to the RDR.

It found half of advisers were initially negative about the RDR requirements, which fell to 43 per cent post-RDR.

Half of advisers also initially expected that complying with the RDR would be an onerous task.

Within this group, 48 per cent felt their expectations were accurate and 38 per cent believed meeting the RDR requirements was more difficult than they expected.

But while some advisers appear to be struggling with the realities of the RDR, clients seem to be responding positively. Some 26 per cent of advisers reported a positive client reaction to the RDR changes, compared to 20 per cent who reacted negatively.

Some 67 per cent of advisers polled said they have lost no clients as a direct result of adviser charging, with 7 per cent saying they had lost more than 10 clients due to adviser charging.

Advisers who were initially negative about the RDR seem to be faring the worst, with 11 per cent of those who expressed RDR misgivings losing more than 10 clients compared to 3 per cent of those who were positive about the RDR from the outset.

The research also found that 10 per cent of advisers and paraplanners surveyed have changed role as a result of the RDR.

Most of this group have decided to advise solely on mortgages, general insurance or protection, while the remainder have either moved to a non-advised management role or are acting as business introducers.