Almost nine out of 10 advisers are not going to change their advice model in the post-Retail Distribution Review world, with the vast majority offering independent advice, research has revealed.
The latest Adviser Barometer from Aviva has found that 7.5 per cent of the 982 advisers polled said they will switch their advice model by the end of 2014 and a further 5.4 per cent said they are undecided on whether they will change their advice model. This leaves approximately 87 per cent saying they are not changes.
The research suggested 84 per cent of advisers offer independent advice, 10 per cent restricted advice, either a limited range of specific products or products from specific providers, and 2 per cent operate a multi-advice model.
Advisers operating with an independent model at the moment are least likely to consider changing the way they offer advice – just 10 per cent are looking at their options, compared with 26 per cent of those offering restricted advice.
Of the independent advisers considering a change, 76 per cent plan to switch to restricted advice, 20 per cent to a multi-advice model and 4 per cent will advise on products outside the scope of RDR.
Meanwhile, 12 per cent of the advisers currently operating restricted advice models, multi-advice models and advising on products outside of the scope of the RDR are planning to change their advice model. Of these, 79 per cent plan to change to offer independent advice.
Overall, restricted advice is the most popular choice for those planning to change business models, chosen by 64 per cent of those wanting a change.
Furthermore, the research revealed that 61 per cent of advisers regularly use two or more platforms and the amount of business they place on platforms is growing.
Aviva said that advisers may be increasing the amount of business they place on platforms in order to increase efficiency and better serve more clients. Around 40 per cent of advisers expect to see an increase in the number of clients they serve, while less than one third expect a reduction.
However, of those who expect a reduction in the number of clients they serve, 31 per cent intend to focus more on higher net worth clients.
Just over one fifth of respondent say they place over 80 per cent of their business on platforms, compared with just 13 per cent in October 2011 and 4 per cent in October 2010.
Around 65 per cent of independent advisers regularly use two or more platforms, compared with 51 per cent of those offering restricted advice.
Andy Beswick, distribution director at Aviva, says: “We are pleased to see so many advisers are settled with their current advice model. In light of RDR advisers have had to make many changes of which choosing the appropriate advice model is fundamental to the success of their business.”
