The Financial Conduct Authority has revealed what it expects from streamlined advice.
In a 48-page paper published today (28 September), the regulator confirmed it will develop a clear framework that "gives firms the confidence to provide streamlined advice on simple consumer needs in a proportionate way".
In the finalised guidance paper for the Financial Advice Market Review, the regulator details new guidance to support firms offering ‘streamlined advice’ on a limited range of consumer needs.
This guidance includes a series of illustrative case studies highlighting the main considerations when developing such models.
The paper also tried to clarify what a fact find should contain.
In addition, the FCA detailed key considerations for verifying a fact find that has been performed by third parties.
Back in June, Andy Briggs, chief executive of Aviva's UK life business, said the Financial Advice Market Review is "not good enough".
Mr Briggs said advice had become more important following the pension freedom reforms introduced in April 2015, which gave people over 55 the right to access their whole pension pot in one go.
He said: "The need for advice and guidance was still there but it wasn't as strong as it is now and they are having to make a decision about taking a lump sum, going into drawdown or buying an annuity.
"The vast majority of people are doing that without advice or guidance and the outcomes from that will be poor. I am convinced they will be poor.
"Frankly where the Financial Advice Market Review has got to so far is not good enough."
The Financial Advice Market Review was introduced by the Financial Conduct Authority in March 2016.
At that time, then acting head of the regulator Tracey McDermott called on the industry not to view proposals in the report in isolation, but as a comprehensive package of measures to tackle the advice gap.
A slew of 28 market changes were recommended in the joint FCA and HM Treasury Financial Advice Market Review report, aimed at achieving “a real improvement in the affordability and accessibility of advice and guidance to people at all stages of their lives”.
Many advisers criticised the measures, with some branding them a “waste of time” and a “missed opportunity”.
The FCA’s refusal to introduce a much demanded 15 year long-stop to complaints was blamed on it cowing to “the consumer lobby”.
Stick with FTAdviser to find out more details of what the FCA plans to do to plug the advice gap.
emma.hughes@ft.com
