He has spent years working for large life offices, mainly in offshore businesses, where he helped advisers. Now he is branching out on his own, using the knowledge he has gained to help advisers deal with the post-RDR world.
He said: “The average offshore investment would have been well over £250,000, whereas the average UK investment was £20,000. That was a massive difference in scale. In the offshore sector we have responded to a low-commission and fee-based environment for the past 20 years.”
He has seen advisers who deal in offshore business – amounting to about 10 per cent of the adviser population – grapple with fees and work out how to treat their clients.
Of his former life, he said: “If you have a client who has £1m of assets, they’re going to make sure they look after their client and guide the client.”
This had a knock-on effect on the way providers dealt with advisers. “They expected added value from the provider, from the start of the relationship,” he said. “They tend to be very busy people and expect the insurance company to deliver.
“So the insurance companies tended to be clear about what they could do for the adviser and make sure everything ran smoothly. If you’re dealing with £1m and get it wrong, it has a serious impact on reputation in terms of service delivery.
“That’s something in the post-RDR world that will be more transparent.”
Mr Leeson said his experience with fee-based advisers proves he has invaluable expertise for the vast bulk of advisers making the transition themselves.
He said: “There’s a range of different things, such as helping to generate fee opportunities and educating clients of the benefits of fee-based advice and help with client retention. I can show that they can offer added value and what value is worth to the client, taking the expertise built up in the fee-based advisory market.”
The challenge is for advisers to show clients the value of being fee-based. Mr Leeson said: “If the client knows he would be £3,000 better off because he’s talked to an adviser, he would be much more likely to be happy about paying the adviser.”
According to Mr Leeson, there are too many advisers adopting a fee-based model that still look very much like commission, with an initial charge of 3 per cent and half a per cent a year based on the investment value.
