More than seven in 10 advice firms (73%) are behind on their Consumer Duty implementation plans, new research has indicated.
A survey by Copia Capital Management found that advisers are either behind the curve (65%), or yet to start (8%), when they were asked how ready their firm was for the Consumer Duty regulations.
Just 27% felt they were on top of the work needed to comply with the rules, which are being introduced by the Financial Conduct Authority (FCA). These rules to improve customer protection are due to come into force from 31 July.
Copia revealed that its poll of 74 advisers was part of a webinar on preparing for Consumer Duty, with its managing director, Robert Vaudry, head of investments, Joanne Benson, as well as the lang cat’s consulting director, Mike Barrett.
Discussing the requirements of the target market assessment under Consumer Duty, Barrett said: “It’s dangerously naive to segment your advice proposition by wealth. Two people with the same level of assets could have very different requirements from their financial planning.
“It’s best practice to segment around need, but this needs to be done in sufficient detail to take into account that even those who share the same need from an investment point of view.
“Most advisers know their customers well, so this won’t be a huge shift. It is just a case of identifying and documenting these detailed target market segments, so you can then demonstrate through your research and due diligence processes how the products and services you recommend, including the platform and investment services you use, meet the needs of your target clients.”
Vaudry added: “We know from our conversations with advisers that many firms are still trying to understand the full implications of the Consumer Duty requirements and many feel they are same way from complying with the rules.
“We’re committed to helping firms navigate their responsibilities, providing practical guidance on the implementation priorities while ensuring that their investment solutions deliver the best outcomes for the firm as well as its clients.”
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