05 June 2020

No surprise in FCA decision to ban contingent charging

2 min read

 
Helen Morrissey, Personal Finance Specialist
Helen Morrissey

Corporate PR Specialist – Long Term Savings

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Justin Corliss, senior pensions development and technical manager at Royal London, comments on the FCA’s policy statement on contingent charging.

“The FCA’s decision to ban contingent charging except in exceptional circumstances does not come as a surprise even though there is no real evidence that it leads to poor outcomes. To mitigate the impact, the FCA has chosen to move forward with abridged advice as it feels it will be a good low cost solution for many people.

"The exceptions to the contingent charging ban, the “carve-out”, will only cover a minority of cases, some people will still be left without access to affordable advice, but there is a feeling that this is the lesser of two evils.

"What is surprising though is that few stipulations have been made regarding ongoing adviser charges even though this is also a potential conflict of interest.”

 

For further information please contact:

Helen Morrissey, Corporate PR Specialist – Long Term Savings

About Royal London:

Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £138.9 billion, 8.6 million policies in force and 4,126 employees. Figures quoted are as at 31 December 2019.