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In a 'Thinkpiece' published today by the Chartered Insurance Institute (CII) today (27 August), Aegon said research had revealed core consumer needs, such as a separation between advice that helps them understand products and advice that helps them buy.

It also highlighted a demand for better understanding of what consumers gain from advice, such as long-term planning and motivation.

Aegon head of corporate affairs Francis McGee said: "The FSA must remember that one of the original aims of the Retail Distribution Review was to open up advice to the wider market.

"Good quality financial advice is essential to helping people take out the protection and savings they need for the future – so let’s work together to make this a reality."

CII director of policy and public affairs David Thomson said: "Much of the current RDR debate has focused on regulatory reforms but just as important is ensuring the voice of the customer is heard. This research and its findings does just that.

He added: "It is a wake-up call for regulators and the industry alike. How customers behave and navigate through the often bewildering world of financial services is fundamental to the changes needed to help improve public trust and confidence."

As a result of the research, which involved over 140 people, Aegon said it had identified five advice concepts consumers want:

1/ Financial guru – an independent expert who provides high quality, holistic, on-going, and personalised financial advice. They are also able to recommend products, but selling them is not the central point. Aegon said this was in-line with RDR proposals for the future IFA.

2/ Financial coach – to get people motivated for financial planning and keep them committed.

3/ Drop-in centre – an initial problem-solving service for people with specific financial problems or needs. Aegon said this was similar to chief executive Otto Thoresen's proposal for the new Money Guidance programme.

4/ Personal shopper – to simplify the choice available and provide products to suit the customer’s needs.

5/ Financial superstore – to make buying easier for people with straightforward needs or who have a good understanding of what they want.

McGee added: "Aegon's research showed people are keen to take financial advice that helps them gain confidence and overcome what they recognise to be bad habits and do the right thing with their finances.

"They have identified models of advice that are not available within the currently regulatory framework. People looked at support services available in areas of their lives such as fitness and diet, and asked, “Why can’t financial services be more like that?

"There are initial signs that people might be more willing to pay for advice that’s presented in the right way and designed around their lifestyle."

To read the latest 'Thinkpiece' published today by the CII, which includes Aegon UK's views, click here.

READER COMMENTS:

Alan Lakey, partner, Highclere Financial Services: "Amidst all the excitement that the RDR entails a very important factor has been forgotten. Experts have emerged who know all the answers and lambaste the industry for previous strategic failures, etc.

"What they forget, possibly out of expediency, is that the majority of the consumers that fail to engage with financial companies do so not out of fear or trepidation, not due to lack of confidence and not due to lack of funds – it’s because they cannot be bothered. Such consumers can be persuaded but they need to be asked.

"The clearest proof of this is the fall in the take up of retirement products since the introduction of stakeholder products. My own pension business has fallen by about 90 per cent and this is because I no longer ask my clients to meet to review matters. I no longer chase them to increase or index their contributions. I don’t do these things because I am no longer paid to do so and these clients will not accede to a meeting if a fee is involved.

"The RDR tentatively recognises this by its suggestion that primary advice, or whatever new title they aware it, will increase the take up. In this regard the FSA is correct, if bancassurers are enabled to market high-charging products to the consumer they will clean up. Why not enable the design of products with a worthwhile marketing allowance which rewards IFAs for prospecting and selling solutions. IFAs are proven to offer a superior and more appreciated service than the banks so why not use them to bridge these gaps?"

Evan Owen, IFADU: "How can 140 people surveyed be described as 'representative'. What are Aegon trying to do, confuse more 'consumers'? The only way to get advice out to more people is to make all advice 'whole of market'.

"The fact is that 'consumers' have to be sold to or persuaded to buy by having their mindset altered by a person who has the necessary skills and is rewarded for doing so. If IFAs were 100 per cent fee only the fact is that there would only be the direct sales outfits left to do any selling so why are we making a fuss about commission? Why is it only the banks can earn commission for selling one products? Who is really behind the RDR?"