Legal & General has apologised to an adviser after it sent a letter to his clients informing them he was no longer associated with their policies.
The provider sent a series of letters to clients of Andrew Oliver, company director at Andrew Oliver & Co, with regards to the protection policies they held with L&G.
But some of the letters stated that L&G no longer had a business relationship with the adviser and unless the client contacted the provider within 21 days, L&G would arrange for a firm called Top Quote Limited to take over the relationship.
The adviser had no knowledge that these letters were sent until his clients made him aware of them.
One letter stated: “We’re writing to you as you have an existing protection policy with Legal & General, and the person of firm who sold it to you no longer has a business relationship with us.
“As you no longer have a financial adviser associated with this policy, we would like to arrange for a company called Top Quote Limited to take over this responsibility.”
Another letter claimed the client had originally purchased the policy through Top Quote, which Mr Oliver contested.
L&G has confirmed the episode was an administration error and that the letters should have never been sent out.
The provider also confirmed that Mr Oliver remained named as the trusted partner on all the affected policies.
An L&G spokesperson told FTAdviser: “We have investigated this incident and on this occasion, very unfortunately, an administrative error has occurred leading to letters being sent to one of our customers that erroneously stated that the adviser with whom they were connected was no longer trading with Legal & General.
“We take very seriously the importance of our relationships with our customers and advisers and we sincerely apologise for the inconvenience and confusion this has caused.
“We are contacting both the adviser and customer to confirm this and have corrected this internally.”
L&G stated the error may have occurred due to its internal programme which deals with orphaned clients when an adviser has ceased trading.
The provider contacts these customers via letter to confirm that their adviser is no longer trading and provides them with the option of being supported through an approved partner.
But Mr Oliver has said the provider should ensure there is a robust process in place so that errors like this don’t occur.
He said: “Problems like this erode the confidence that the client might have with the provider.
“Companies should have processes in place so that mistakes like these don’t happen, more from the client’s point of view than that of an adviser in this case.
“It is concerning when mistakes like this end up in the client’s hands and they are left wondering whether the still have their financial adviser.”
Ricky Chan, director and chartered financial planner at IFS Wealth & Pensions, said such errors could be detrimental to the adviser client relationship.
Mr Chan said: “[This error] is certainly damaging to the adviser-client relationship as it could appear to the client that the adviser has been removed or is in some way illegitimate, hence trust could be lost. So it can be unsettling for clients, particularly if it’s a fairly new client.”
He added: “The providers need to ensure that they respect both advisers and clients, and mistakes like this should not happen as it indicates some failings in their record keeping.
“Furthermore, if the client has responded and agreed for the new adviser to become their servicing agent, this would likely breach some data protection/GDPR rules as the new agent would have access to the client’s policy.”
amy.austin@ft.com
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