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Presenting the ups and the downs of products

This article is part of
Guide to Due Diligence

To present the pros and cons of a product an adviser must know what is under the hood of what they recommend and how the vehicle can meet consumer needs.

Using a structured approach to suitability letter writing should help advisers articulate the positives and negatives of a product, according to Stephen Gazard, managing director of Sesame Bankhall Group.

The use of comparison tables or other diagrams may also present the pros and cons in a clear, concise way for your clients. Above all: always have the client in mind.

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“The regular use of suitability letter checklists and independent reviews of files can provide valuable feedback here and identify if you need to make any changes to your letter of recommendation.”

Simon Thomas, head of policy for Tenet, says: “Will they understand it… will they read the report fully... does it do what is required?

“You’re not writing for an exam, you’re writing for a client, so detail it accordingly and bear in mind the target audience.”

Rebecca Prestage, head of policy of The Consulting Consortium, says a good way to check understanding is for the adviser to ask the client to explain what they have been recommended.

“Engage with the client and ask the client to articulate their understanding of the information/messaging provided.

“An adviser must have a relationship with their client and be able to assess where they can or cannot understand the information put before them.

“If an adviser is unbiased and payment of advice services is not contingent on a product sale, it should be straightforward for them to remain impartial and clearly explain the up and down sides to any product being considered.

“All product features should be explained in plain English and justifications of the recommendations clearly evidenced.”