Adviser insurance sales practices targeted

Thu, 07 Sep 2006

The popular consumer watchdog Which? has targeted financial advisers in a recent investigation.

Which? asked a group of financial advisers (some tied and others independent) for advice on saving for retirement, and protection of the income should ill health prevent work. They found that just 26 per cent passed benchmarks set by the watchdog.

Tied advisers were apparently the worst, with just 16 per cent passing all standards. Financial advisers selling products such as life insurance and protection insurance led buyers to believe that they could choose from a range of products whilst in actuality their choice of products was severely restricted.

Which? also targeted keyfacts documents from a number of lenders, building societies and banks. Their implications of choice were also misleading, the watchdog claimed .

Independent Financial Advisers faired better, but they still didn’t hit their mark. Only 34 per cent passed all benchmarks for good financial advice .

The Shadow Chancellor, Vince Cable, said that the findings: "emphatically underline the growing and glaring need for a genuinely independent system of generic financial advice which does not depend on the self interest of people trying to earn commission."
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