Not my words but direct from Defaqto, if you don’t believe me believe them. (original link http://www.defaqto.com/adviser/insights/impact-rdr-industry-communications-clients)
Impact of the RDR on industry communications with clients
On the 26 March 2010, the Financial Services Authority (FSA) issued Policy Statement (PS) 10/6, Distribution of retail investments: Delivering the RDR – feedback to CP09/18 and final rules, and although many of the principles remain consistent with themes discussed throughout the consultancy process, there are many issues that require further consideration by advisers.
One such consideration is client communications. A host of information to existing and potential clients should be reviewed
1. What is the RDR?
Client exposure to details of the new distribution framework is likely to have been limited to snippets within the personal finance press. Much of the responsibility for educating clients will therefore fall to the industry. Advisers should seek to include clear explanations and client impacts within their regular communications and websites.
2. Company ethos and brand
Transparency for consumers will ultimately mean IFA brand will need to establish themselves more firmly over future years. Reinforcing company ethos and brand values in line with the RDR principles will help to create clarity for existing and potential clients.
3. ‘Independent’ or ‘Restricted’
Existing clients will need to understand the scope of advice chosen so that clients understand if a whole of the market route is being used or products are being offered from a more limited range. The approach will no doubt be different to what clients are used to and early communication is paramount.
4. Advice services and charging
Undoubtedly media coverage will increase throughout the course of next year and set expectations with clients. Adviser businesses will need to list the services they can provide in a clear and transparent menu format. Ongoing services that will be provided to the client need to be confirmed along with details of chargeable and non-chargeable events and services. Payments for annual advice and where these become applicaple will need to be clear.
A charging matrix could be considered to help explain if costs are levied on a time/cost basis or on a percentage of the fund invested. The payment method must work for both parties.
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