Advisers are increasingly counting on accountant and lawyer referrals to attract new clients and expect this to become a bigger source of business over the next 12 months.
According to a Prudential study, 37 per cent of IFAs said referrals from existing clients are by far the biggest source of attracting clients. But referrals from lawyers and accountants are firmly established as the second best source.
More than half (52 per cent) of advisers believe the number of referrals they receive from other professionals will rise in the year ahead, boosting new business levels. The study found 15 per cent of advisers say accountant and lawyer referrals are already their biggest source of new business – slightly up from 11 per cent in a similar study last year.
Guy Myles, chief executive and founder of advice firm Flying Colours, said that accountants, lawyers and similar businesses have pools of clients who are in need of financial planning.
Mr Myles said: “I think the attraction of professional connections is directly related to the huge untapped advice market out there. It is working well for us.”
Prudential said an increasing willingness by advisers to outsource specialised and complex advice might be part of the reason why many expect to see growth as a result of professional connections.
The growing need for advice on protection from inheritance tax bills is another reason put forward, with 58 per cent of advisers seeing a rise in inheritance tax advice enquiries.
Paul Harrison, head of Prudential’s business consultancy for advisers, said: “Outsourcing to specialists and working in partnership with other professionals with expertise in complex areas is becoming a significant part of the advice market, but it does require clarity as to the roles and responsibilities of all involved.”
Ima Jackson-Obot is features writer at Financial Adviser
