Good morning and welcome to your Morning Briefing for Tuesday 24 September 2024. To get this in your inbox every morning click here.

Annuity comparison quotes hit new highs in 2024

Pensions technology provider iPipeline has reported a significant rise in demand for annuities among financial advisers.

In the first half of 2024, annuity quotes increased by 12% compared to the same period in 2023, marking the highest demand since iPipeline began tracking in 2013.

This follows a record 60% year-on-year rise in adviser annuity comparisons on its platform in 2023.

Transact adopts electronic Cash ISA transfer service

Transact has become the first intermediary platform to adopt an electronic Cash Isa transfer service via Pay.UK (BACS) and Equisoft.

This simplifies the transfer process by enabling seamless information exchanges between Transact, banks and building societies, removing the need for paper-based transfers.

Previously, transferring a Cash Isa required sending paper instructions to banks, locating processing teams and manually completing the steps.

Financial Adviser 2B: Questions to ask prospective employers in a job interview

There is often a point during job interviews where the candidate is asked if they have any questions to put to the employer.

This part of an interview can be overlooked during preparations — but asking the right questions can help a prospective employee decide if the role is a good fit for them, while showing the employer that the candidate genuinely wants a career in advice.

So, what are the best questions to ask?

Quote Of The Day

She left the conference in no doubt that painful decisions are coming – although the country remains in the dark on where exactly the axe will fall

– Tom Selby, director of public policy at AJ Bell, comments on Chancellor Rachel Reeves’ conference speech ahead of the 30 October Budget

In Other News

Unbiased, the UK’s top platform for finding financial advisers, has announced a new integration with intelliflo.

This upgrade automatically transfers accepted leads to an adviser’s intelliflo account, improving efficiency by reducing manual tasks.

The feature is available to firms on Standard, Enhanced, Premium and Enterprise plans.

Iain Thomson, chief product officer of Unbiased, said: “We are dedicated to enhancing our platform so that we can offer the best possible experience to our customers.

“This integration with intelliflo is a demonstration of our ongoing efforts and investment in improving our offering and supporting growth in the industry.

“The API will help make converting leads into clients even easier with faster contact rates and improved cadence.”

China unveils raft of measures to boost economy (BBC News)

Growth softens across UK businesses in September, PMI shows (Reuters)

‘Get a grip’: why has the UK’s Labour government been so bad at politics? (Financial Times)

Did You See?

The Platforms Association launched yesterday (23 September) to represent and provide a voice to the £1trn investment platform sector.

The launch marks a step change in how the platform industry will engage with regulators and policymakers.

It aims to bring a united voice to co-ordinate and promote industry interests.

Several high-profile investment platforms, including Abrdn, Aegon, Fidelity, Quilter, Seccl and SS&C, are represented on the board and leadership council

Membership will be open to UK and European regulated firms whose primary activities are the settlement, custody and safe keeping of retail investor assets.

It will also be open to regulated sub-custodian firms providing dealing and safe-keeping services to organisations acting on behalf of retail investors.

Read the full story here.

Transact has become the first intermediary platform to adopt an electronic Cash Isa transfer service via Pay.UK (BACS) and Equisoft.

This simplifies the transfer process by enabling seamless information exchanges between Transact, banks and building societies, removing the need for paper-based transfers.

Previously, transferring a Cash Isa required sending paper instructions to banks, locating processing teams and manually completing the steps.

With this new service, clients no longer need to wait for cheques, and funds can settle in their accounts faster. The system ensures secure, reliable transfers, adhering to best practices and industry regulations.

Seventy-two leading banks and building societies are now using the service, which automates Cash Isa transfers, including Junior Isas. This is expected to significantly reduce transfer times across the industry.

For example, Transact’s cash/electronic transfers now take an average of nine days, compared to 42 days for manual or in specie transfers.

Transact’s recent survey reveals that 90% of financial advisers support electronic messaging to speed up transfer times, urging regulators to encourage wider adoption by legacy providers.

The platform has seen year-on-year improvements in transfer services, including the creation of regional transfer specialists, the introduction of an online transfer tracker and enhancements to the online transfer application process.

Tom Dunbar, chief development officer at Transact, said: “We are obsessed with trying to improve transfers and this latest development links our commitment to improve transfer times with our digitalisation programme.

“We expect thousands of cash Isa transfers onto Transact to benefit from this new, faster service each year.

“We remain committed to personal service but where automation or integrations can speed up processes, we are keen to adopt new solutions.”

The amount of money invested into Cash Isas in the last tax year increased by 50% compared to 2022-2023.

Pensions technology provider iPipeline has reported a significant rise in demand for annuities among financial advisers.

In the first half of 2024, annuity quotes increased by 12% compared to the same period in 2023, marking the highest demand since iPipeline began tracking in 2013.

This follows a record 60% year-on-year rise in adviser annuity comparisons on its platform in 2023.

iPipeline’s annuities portal now accounts for 25% of all quotes in the UK retirement market.

The company’s November 2023 ‘Building a Better Retirement’ report, produced with Retirement Review, revealed that the average UK saver aged 40 to 66 targets a pension pot of £223,503, yet many fall short.

The average total value of personal pension pots is £167,891, with 23% of savers holding less than £50,000, and 37% having no savings target at all.

The findings highlight the growing importance of annuities in retirement planning.

Greg Neall, chartered financial planner at Wake up your Wealth, said: “This clearly shows a continued return to the annuity market by advisers, which comes as no surprise as annuity rates for those in their mid to late sixties are comparable to sustainable drawdown rates.

“If this higher interest rate environment persists, I believe the rates of annuity quotes will continue to increase particularly for those investors over 70 who have deferred taking their pension pots or have used a drawdown to transition towards a secure income later.”

Paul Yates, product strategy director at iPipeline, said: “We’ve seen advisers are searching for annuities during a time of higher interest rates. We assume, that now rates have started to fall and may continue to do so, these annuity numbers will start to slowly reduce.

It will be interesting to see what happens in the second half of the year (especially with the current market volatility levels). We are unlikely to see a return to interest rates under 1% again, so annuities should remain a key part of an adviser’s retirement toolkit, especially for older retirees who need income guarantees.

“We would also expect to see growth as the number of people with drawdown pots increases and as the age profile of holders grows.

“At the same time, we have a new government that could start to make major changes, and that may impact the way we save for, and spend in, retirement.”

Shuttterstock / ComicsansThere is often a point during job interviews where the candidate is asked if they have any questions to put to the employer.

This part of an interview can be overlooked during preparations — but asking the right questions can help a prospective employee decide if the role is a good fit for them, while showing the employer that the candidate genuinely wants a career in advice.

So, what are the best questions to ask?

I’d want to understand how a firm embraced technology to assist its clients and how it provided exceptional client service

Nobody wants to feel like the proverbial fish out of water in a new job, which is why understanding a company’s culture is so important.

When people talk about company culture, they are referring to things such as shared values, attitudes and behaviour that shape how a business operates.

“Company culture is becoming more important to candidates, with 45% of employees and business leaders ranking this as the most important factor when looking for a job,” says Equilibrium Financial Planning culture and recruitment manager Kelly Eyton-Jones.

By asking about trending topics — such as the Consumer Duty — candidates can show a genuine interest in the industry

She believes that asking questions around team dynamics and work-life balance can be helpful for job seekers in assessing whether the work environment aligns with their preferences and values.

Financial services recruiters often find that, when hires don’t work out, it is due to a misalignment of culture and values. These experts say asking questions up front, during the interview, can help to avoid this.

“Questions around ethics, continuous professional development, targets for report writing and the firm’s own plans for growth are always good areas to focus on,” says recruiter Fram Search’s director of financial services, Kelly Biggar.

Recruiter Exchange Street’s director, Andy Taylor, says candidates need to find out what it is really like to work at the company in question.

Ask things like, ‘What is the most important thing you would want me to achieve?’ You can then take a view on whether it’s achievable

“Asking, ‘What is the culture like here?’ is a weird question, so I’d break it down. Ask questions like, ‘What characteristics do people who do this job well seem to share?’” he says.

“One that’s a bit more challenging is, ‘What would the people in the team say it’s like to work here?’ That can draw the interviewer out to talk about any issues the firm has faced and what it is doing about it.”

Candidates will be able to ask more probing questions around culture if they have done a bit of digging beforehand.

“Do your research — and that shouldn’t stop at the company website,” says Succession Wealth recruitment manager Charlotte Turner.

“Look at employee and company content on LinkedIn and social media. Check out what awards the company has been nominated for or won, events they’ve been involved with, and really get a sense of what’s important within the company culture. Then ask questions related to those aspects you identify with.”

Enquiring about how the changes in the Consumer Duty have impacted the business shows they have undertaken thorough research

Another subject candidates may want to ask about is the firm’s compliance culture.

Karishma Galaiya, senior manager of investments at compliance consultant Thistle Initiatives, says showing an interest here demonstrates that the candidate understands the sector and the importance of delivering positive consumer outcomes.

“Enquiring about the organisation’s implementation of the Consumer Duty may also offer insight into how consumers are treated,” she says.

Training and development

We have all heard cautionary tales of people joining a firm but not progressing, or being given unrealistic targets. To avoid this at the start, commentators recommend asking questions about training and development during the job interview.

Eyton-Jones suggests finding out about the qualifications or exams that must be completed in the first year, or the types of client they may expect to work with.

“These questions not only help to manage candidates’ expectations but also provide them with valuable insights into their potential long-term work,” she says.

Questions around ethics, continuous professional development, targets for report writing and the firm’s own plans for growth are always good areas

For Taylor, tactful questions such as, ‘What will the first 12 months look like?’ and, ‘How will you train me?’ can determine whether a firm invests in developing its people.

“You can also ask things like, ‘How will you measure my performance?’ and, ‘What is the most important thing you would want me to achieve?’ You can then take a view on whether it’s achievable,” he says.

“If the business sounds great but expects you to do too much — well, nobody can do that.”

Industry trends and topics

Employers want to hire genuinely enthusiastic people — not someone who simply wants a job. So, anything that shows that a candidate has done their homework on the firm and the profession will go down well.

“By asking about current events and trending topics, candidates can demonstrate a genuine interest in the industry,” says Eyton-Jones.

Company culture is becoming more important to candidates, with 45% of employees and business leaders ranking this as the most important factor

“For instance, enquiring about how the changes in the Consumer Duty have impacted the business shows they have undertaken thorough research and have a sincere interest in the industry.”

Asking about a firm’s approach to technology is also a good idea.

“If I were starting out, I’d want to understand how a firm embraced technology to assist its clients and how it provided exceptional client service,” says Twenty7tec chief executive James Tucker.

“If a company is getting these things right, it’s very likely to be a great environment to learn in and develop a long career.”

This article featured in the September 2024 edition of Money Marketing. 

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Income Protection Awareness Week (IPAW 2024) kicked off today (23 September) with a seminar for advisers exploring the current income protection (IP) market.

The awareness week is being organised by the Income Protection Task Force (IPTF) to raise the profile and grow sales of IP products.

The week will comprise a series of online keynotes, panel debates, case studies and presentations and will tackle various themes across income protection.

Today’s session looked at the case for income protection and what advisers are seeing in the market and in client conversations.

It also looked at how advisers include IP in their advice process and the impact that consumer duty has had on adviser behaviour.

Jo Miller, co-chair, IPTF, said the IP market has seen a rise in sales, with a record number of sales on advice.

However, she urged the sector to keep up the momentum as more work needed to be done.

The adviser panel – consisiting of Mike Douglas, protection specialist, Woodside Financial Services, Nina Brown, protection specialist at Pam Brown Mortgages, and Hannah Murray, financial adviser, St. James’s Place Protection Planning – expressed similar sentiments.

For his part, Douglas urged advisers to make the IP advice process simple by explaining the benefits and pitfalls of not having IP cover.

Meanwhile, research from protection and employee benefits provider MetLife UK has found that while one in five (20%) consumers see the benefit of financial protection, 12% don’t understand the difference between the various offerings.

The study, published today, found one in ten (9%) customers admitted they only thought about financial protection once it was too late and they needed to claim.

MetLife said IPAW provides the chance for advisers to talk to clients and review what protection they do and don’t have in place.