The massive majority of advisers continue to support the introduction of a 15-year long-stop, latest research from The Association of Professional Financial Advisers (APFA), in conjunction with campaign partner Zurich, reveals.
Last month APFA consulted with advisers on possible solutions to limit liability for advisers to help inform ongoing discussions with the regulator and the latest findings show the level of support amongst the adviser community for the different options.
Key findings are:
• A 15-year-long-stop is the outright favourite amongst advisers (76%)
• 10% prefer an insurance based system with costs shared across the industry as second most popular options
• The third choice amongst advisers (8%) is to limit liability appropriate to the nature of the product
• The least preferred option (6%) is a 15 year liability limit from the end of an ongoing advice
With the majority of advisers expressing a preference for the introduction of a long-stop, an overwhelming majority of advisers (83%) did not believe this would cause consumer detriment.
Meanwhile, 76% indicated there would be a cost benefit for consumers if a 15-year long-stop is introduced, with advisers able to reduce their costs and pass on these savings to customers.
Chris Hannant, director general of APFA, said: “The survey provides a clear insight into adviser feelings on the potential options to address the challenge of unlimited liability, and advisers clearly view the longstop as their most preferred option. It is important that we get a solution which addresses these challenges and the recent FSCS levy highlights just one of the major issues facing the industry.”
Richard Howells, UK intermediary sales director at Zurich, said: “Whilst we understand that 15 year long-stop remains a clear favourite amongst advisers, at the same time we need to be mindful of the challenge from the FCA to find a solution which ensures there is no possible detriment to consumers. We’ll continue to explore all the options to mitigate liability and will be working closely with APFA over the coming weeks to help ensure an outcome that works for the industry, the consumer and the regulator.”
Hannant added: “We will continue our dialogue with the FCA and will be releasing further research findings in the coming weeks. Our results will also feed into our ongoing discussions with the regulator. We expect a decision this year and will keep you informed on any further developments.”