Corporate IFAs market share ‘to grow’

Providers expect corporate IFAs to increase their market share of the group pensions sector in the next three years, according to research carried out by Surf & Consult.

The research, which surveyed the views of eight group pension providers, found corporate IFAs the only sector of the market to actually grow market share, with more than half of those polled predicting a significant increase, at the expense of regional IFAs and general brokers. The market share of EBCs, currently the biggest sector, is expected to remain roughly the same.

All providers confirmed that they would be take over schemes if the adviser was unable to continue servicing the client, but 71 per cent confirmed that adviser commission would then be retained.

None of the providers polled said they would support new advisers launching into the group pensions market through the FSA approval process, with only 12.5 per cent stating that they would provide some support immediately following approval.  The position for more established companies was quite different however with 75 per cent confirming that they would offer a mixture of marketing material, including bespoke communication information, seminars, web based literature and MI reports.

A qualitative section of the report found that providers’ concept of corporate wrap or workplace savings is still evolving and the industry is yet to agree on a suitable definition and description for it.

Tim Gillingham, director of Surf & Consult says: “Two years ago providers were focusing on their individual products, but it is good news for corporate intermediaries that they are now targeting workplace. The one threat behind it all is that the direct channel could grow, which could lead to some difficult conversations once providers are already in contact with advisers’ clients.”