What is the future for corporate advice?

AE is an amazing opportunity and some advisers have already repositioned their practices as an AE implementation provider and are selling to other advisers. It is too late, as the market is already congested, to adopt this approach now but partnering with an AE platform or solutions provider is preferential to simply handing these off to a pension provider.

Any adviser looking to differentiate themselves, or to add value to the process, will do well by talking employee benefits rather than pensions as that will ensure on-going contact, remuneration after the initial AE pension implementation and retention of the client for other opportunities.

In the group risk world there are two themes: modernise the benefit scheme design and make the most of the additional value employers can have as part of the package.

The planned changes to the employment and support allowance (ESA) in 2017 mean that group income protection clients need to review their scheme design. There are legacy designs such as ‘integrated’ and ‘net pay schemes’ which need a much more urgent review than the simple State Benefits deductible scheme design.

Perhaps it is about time pensions were modernised and made simple

More importantly the planned alignment with Jobseekers Allowance is, in effect, a reduction of one third. Individuals planning to rely on State Benefits need group income protection more than ever before and forward-looking organisations should embrace this benefit in the short term. We have been desperate for growth in this market and perhaps, just perhaps, new employers will start enquiring or be convinced by advisers that this is their priority benefit.

Eligibility scrutiny is needed in group risk too. Who should get the scheme? With all employees being offered a pension and, with additional selection and medical underwriting costs, a move from ‘all pension scheme members’ to ‘all employees’ can reduce rates and make the scheme simple.

Expanding executive schemes to all employees provides simpler accounting/budget certainty, less medical underwriting and enhances the likelihood of corporation tax relief, whilst simultaneously providing an attraction/retention benefit. This is becoming a key challenge for employers.

On the gaining and retaining of staff point, group risk insurers offer additional value services but all vary in their depth and breadth. For example, a risk insurer and a PMI/cash plan insurer may offer an EAP but aside from the number of sessions, does it also provide MI and on-going communications? EAP scheme designs do not work unless they are celebrated and used/targeted and yet, despite there being many additional value services in group risk alone, few advisers offer a service comparison approach.