Training for advising vulnerable clients

In its guidance for businesses in the fair treatment of vulnerable customers, the Financial Conduct Authority sums up its expectations, including that businesses need to: 

• understand the needs of their target market/customer base;
• make sure staff have the right skills and capabilities to enable them to recognise and respond to the needs of vulnerable customers;
• monitor and assess whether they are meeting and responding to client needs; and
• make improvements where required. 

Johnny Timpson, founder and chair of the Access to Insurance Working Group, who is also a commissioner at the Financial Inclusion Commission and a member of the Financial Services Consumer Panel, says: “Identifying and supporting clients in moments and times of vulnerability is challenging.

“The FCA’s vulnerable customer guidance, its focus on inclusion and diversity, and its current consultation on customer duty makes vulnerable customer identification, support, intervention and outcomes priority issues for firms.” 

There is therefore no doubt about how important the issue of vulnerable clients is for advisers.

Understanding exactly what a customer may be vulnerable to, sensitively starting a conversation with the customer about this, and then providing meaningful support is the real challenge  Chris Fitch, the Money Advice Trust

So, how can advisers ensure that they and their staff are well-trained and sufficiently knowledgeable to be able to meet the needs of their vulnerable clients, including enhancing soft skills, wherever this may be required?  

Training for advisers

Justin Harper, proposition and marketing director at LV, says: “Companies like ours and the financial advisers we work with need to demonstrate to the FCA that we’re doing the right thing for vulnerable customers.”

LV provides support through a guide on vulnerable customers, produced specifically for advisers.    

For those who may have a number of older clients, there is help at hand from the Society of Later Life Advisers. It has a free online training tool, which helps advisers who work with older people to identify vulnerability in later life. 

Peter Hamilton, head of market engagement at Zurich, points to the Association of British Insurers for helpful information on mental health: “The ABI has introduced an online mental health training platform to help advisers and frontline staff gain a better understanding of mental health issues, and to improve accessibility and support for insurance customers.” 

The platform was developed in collaboration with employee health and wellbeing specialists Rightsteps. The training is Chartered Insurance Institute accredited and comprised of three courses.

The first focuses on enhancing understanding of the most common mental health conditions; the second is on effective communication with people who have a mental health condition; and the third is on how to support customers experiencing a mental health crisis. 

Launched in April this year, the training module is free of charge in the first year, with fees to be announced at a later stage.

Timpson also has some recommendations: “Vulnerable customer information is available from the CII (through a guide to good practice) and I would recommend that firms check out the comprehensive support available from the Money Advice Trust, through its vulnerability resources hub and also through its training and consultancy service.” 

The Money Advice Trust charity reports that it has been delivering vulnerability training and consultancy over the past 10 years to regulators, trade bodies, businesses and government. Most (around 85 per cent) of the organisations it has provided training for are in the financial services sector.

It also offers a range of free vulnerability resources to help staff and organisations, including research, practical guides and podcasts on topics such as the FCA vulnerability guidance, suicide intervention, financial crisis and serious illness.

Chris Fitch, vulnerability lead consultant at the charity, says: “Financial advisers should have a good understanding of their customers’ circumstances. This can be an enormous help when identifying vulnerability. It can allow you to see when changes in a customer’s situation occur, or even make it more likely a customer might disclose a vulnerability to you.

“However, identification is only the start. Understanding exactly what a customer may be vulnerable to, sensitively starting a conversation with the customer about this, and then providing meaningful support is the real challenge. 

"Our training, based on our work with more than 300 firms and more than 25,000 staff, breaks this challenge down and shares what we’ve learnt about doing this in a practical and commercially realistic way.”

In addition to training and accessing information online, Kathryn Knowles, managing director at Cura Financial Services, reminds advisers to bear in mind some fundamental points when communicating with vulnerable clients: “When you speak to vulnerable clients you cannot just go into form-processing mode. You need to actively listen and make sure that you are hearing everything that is being said – and not said.

"This is so that you can make sure that you are not missing a key element of their financial risks, that you can identify a need for safeguarding and also so that you can make sure that you are truly treating your customer fairly.”

For those advisers seeking external support, Knowles says: “There are a number of companies that advisers can contact that can help with developing communications skills, to support clients. I suggest finding a sales coach that has direct experience in working with vulnerable clients. They could also engage with organisations like Purple, which provides specific disability training.”

Knowles adds: “I would suggest that if advisers are part of a network, that they ask them to provide some vulnerability training. They could contact local Personal Finance Society branches and CII institutes to ask them about this too.”  

Fiona Nicolson is acting deputy features editor at FTAdviser