Aviva catches up with rivals on Mifid offering

Aviva catches up with rivals on Mifid offering

Aviva is to add a function to its platform that will notify advisers and their clients if a client's portfolio has dropped by 10 per cent or more in value.

The platform, which has been blighted by technological issues since its replatforming last year, said the move was part of offering a better service, not because it would be obligated to do so under the Mifid rules.

The Mifid 10 per cent depreciation rule applies to DFMs or advisers with discretionary permissions, that provide a portfolio management service for their client.

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Under the rule these entities must inform clients if the overall value of their portfolio falls by 10 per cent or more compared to the beginning of each quarterly reporting period.

A representative of Aviva said: "The 10 per cent depreciation monitoring rule under Mifid II applies to DFMs. 

"As a platform, we are choosing to introduce monitoring as a standard part of our service to customers – this is in the context of enhancing our overall platform functionality."

Aviva expects the service to launch between now and May and has confirmed it will not charge advisers extra for using it.

The Aviva representative said: "The calculations that need to be performed are quite complex when you are making them bespoke for clients.

"The technology is quite complex, but we expect it to go live later this year. We know that the calculations for this are time consuming and quite complex, but advisers will have those done for them with this service."

Aviva is one of few players in the industry not already offering this service. Data compiled by FTAdviser last year showed a wide variety of platforms already offered this service.

Aviva too stated at the time it would offer it on its pension portfolios, as long as there was a discretionary element.

Then in April it emerged a glitch on its platform had caused advisers to be falsely notified about huge drops in the value of their clients’ portfolios.

An Aviva spokesman said: "The service will cover general investment account (GIA), Isa and pension wrappers.  

"We have only made one alert previously, in April 2018, which was in error. Our platform IT solution is in build and we look forward to relaunching the service in the first half of 2019."

Minesh Patel, an adviser at EA Solutions in London, and a client of Aviva, said: "It is good they are introducing this service, though we get the information we need to comply with the rules from our DFM.

"It is good that Aviva will also offer this service to advisers."