Podcast  

Lead gen must be held to same standards as advisers

Lead gen must be held to same standards as advisers

If advisers and providers are to be held to high regulatory standards, then so too should cold-callers and online financial promoters, industry spokespeople have said.

Joanna Streames, founder of Velvet Mortgage and Insurance Services, said: "The fact that regulators are cracking down on these [adverts and campaigns] more than they did previously is good, but there is a long way to go.

"In the 12 years I've been in the industry, I've only paid for lead generation one time, and the experience was awful. As a consumer of this, I would not use their services.

"I did not feel confident in the quality I received and, until now, I've grown my team organically."

But what happens when firms want to reach more people, more quickly and need to use lead generation? It has to work for both the broker and the consumer, she said.

Streames added: "There is nothing more frustrating when you are trying to raise awareness around our industry, and raise the value of insurance in the eyes of the public, to [have these sort of adverts around].

"If we, as advisers, are so heavily regulated, then [greater regulation] on advertising has to come. It can't come soon enough."

Her comments were echoed by Alain Desmier, founder of Contact State, who said that lead generators and advertisers should also go through all the hoops that advisers, brokers and providers go through. 

He referenced the consumer duty document, which is due to be published at the end of July, stating: "There are specific provisions for firms having a whole view of the entire customer journey and the ancillary third parties – including lead generators – have to fall under the same regulation.

"To be blunt, the Financial Conduct Authority has been behind on this for five years and it has now woken up to the fact that lead generation has to be treated in the same way as if it were selling a product."

The regulator has been cracking down on inappropriate and fraudulent advertising, as reported by FTAdviser previously, with the potential for high-profile scalps in the months to come as breaches are found.

In June this year, the FCA unveiled its three-year plan to augment its AI and tech capabilities.

At the time, it highlighted how it was already using advanced analytics and new sources of data to identify inappropriate financial adverts.

According to the regulator, last year 564 adverts were withdrawn or amended, double the number compared to previous years.

Desmier said there was a role for good lead generation to help promote insurance to consumers, but having more robust regulation would certainly help to improve the whole of financial services, whether mortgage, insurance or other financial services leads. 

"Nobody should buy a lead unless they know exactly where it comes from," he said. 

To listen to the full podcast, click on the link in the story above.