02 June 2020

Advisers remain resilient in the face of Covid-19

5 min read

 
Helen Morrissey, Personal Finance Specialist
Helen Morrissey

Corporate PR Specialist – Long Term Savings

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  • More than two thirds of advisers expect business to return to usual within three months;
  • Six in ten advisers have had more contact with clients since Covid-19;
  • Advisers are reporting an increase in enquiries for protection products;
  • Nearly half of advisers have been approached to either sell or merge their firm in the last two years. However, only one in ten of all advisers believe consolidation results in good outcomes for clients.

Advisers are optimistic about the resiliency of their business in light of Covid-19, according to Royal London research. Feedback from 96 advisers in April1 shows more than two thirds (67%) say they expect to see business return to usual within three months of the ‘end of Covid-19’. Nearly four in ten (37%) expect this to take only one month, and only 10% expect this to take more than six months.

While new business demand has dipped advisers say they are spending more time speaking to their current clients. Six in ten advisers have seen inbound contact from clients increase by 25% with demand for reassurance on investments, information on furlough, self-employment and payment deferrals.

However, demand has grown for protection products in the current market. Feedback also suggests that mortgage advisers are beginning to explore protection-related business opportunities as the housing market is subdued.

Selling and merging

These high levels of adviser confidence were also evident in research the mutual insurer carried out with NMG2 before the crisis. Responses from 426 advisers showed that while nearly half (48%) had been approached to either sell or merge their business in the last two years only 17% were actively considering it with the majority of smaller firms planning to stay independent. Only one in ten of all advisers believed consolidation was the best option for clients and around one-third of advisers were investing in people to help grow their business and improve efficiency.

Helen Ball, group operations director at Tenet Group agreed that many advisers favoured independence. She said:

“The findings of this research back up Tenet’s belief that the majority of advisers value their independence and the ongoing provision of independent advice for their customers. Being part of the Tenet network gives principals the option of a future exit, retiring from the industry in the knowledge that their clients will continue to receive quality independent advice, rather than sell them into a restricted model, with clients receiving a very different proposition.”

Commenting on the research, Tom Dunbar, distribution director at Royal London Intermediary, said:

“Seeing advisers keeping calm and staying resilient in the face of Covid-19 is good news for the industry. While many will face challenges in the months ahead, it’s clear that the marketplace for impartial advice remains buoyant with advisers looking for opportunities such as within the protection market.”

Notes to editors

  1. The Forum asked 96 advisers how the COVID-19 pandemic has impacted them and their businesses. The Forum task was live between 1 April and 17 April 2020.
  2. NMG and Royal London surveyed 426 advisers from both Royal London’s sample and NMG’s adviser panel. Fieldwork was conducted in December 2019.

For further information please contact:

Eliot Woolfe, Press Officer

About Royal London:

Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £139 billion, 8.6 million policies in force and 4,348 employees. Figures quoted are as at 30 June 2020.