However, when it comes to consumers themselves, it is likely that many might not be aware of their vulnerabilities, or do not want to admit to them. Advisers therefore face the difficult challenge of not only spotting vulnerability, but also dealing with clients who do not realise it applies to them.
Spotting the signs
The good news is that more advisers are recognising clients who are vulnerable and are actively looking for ways in which they can help them.
Two in five (39 per cent) advisers said they had seen an increase in vulnerable clients over the past 12 months – up from 30 per cent in 2019 – according to more2life’s report.
However, while this demonstrates that advisers’ understanding of vulnerability is moving in the right direction, the figures are still low when compared with the FCA data.
Therefore, it is important that advisers are knowledgeable of and consider the full range of vulnerability triggers, especially the more subtle signs, when dealing with older clients.
While advanced age or life-changing events, such as divorce or bereavements, will be obvious red flags for many, poor mental health or financial shocks may be less obvious signs that someone is vulnerable and could be missed by some advisers.
However, if a client with a significant amount of debt is about to have their house repossessed, this is a clear indicator of vulnerability.
In addition to spotting potential signs of vulnerability, advisers should also be proactive in their approach when it comes to dealing with vulnerable clients.
In addition to keeping recordings and accurate records of your interaction, this might mean spending more time taking through the product features and potential impact on their lives or even explaining why you feel they are vulnerable and how you intend to support them.
Other priorities could include engaging with interested parties, such as relatives, carers and lawyers, or flagging the vulnerability to other companies in the chain to ensure clients are properly supported throughout the equity release process.
Another approach which may be overlooked by some advisers is asking other parties for guidance and sharing best practice with industry colleagues to ensure vulnerable clients are identified and cared for.
For example, advisers could speak to another member of their team about how to support vulnerable clients, or seek guidance from other professionals during the advice process.
More could be done
While adviser knowledge has improved over recent years, there is room for improvement, especially when it comes to the more subtle vulnerability triggers as previously noted. Indeed, nearly nine out of 10 advisers (88 per cent) admitted it is not easy to spot a vulnerable client.
