Selected 11 Autumn 2020

A Tenet Group Publication

Issue 11 Autumn 2020

SPECIAL FEATURES The Opportunity Behind the Contingent Charging Ban

OTHER FEATURES Helping Attract the Best –

Tenet launch the new Applicant Tracking System and Careers Site

Introducing the Tenet Assistance Programme provided by Care first

FOR INVESTMENT PROFESSIONALS ONLY

Painting a more positive picture Premier Miton INVESTORS I NCOME FOCUSSED FUNDS

Proven income from two multi-asset, multi-manager funds

Premier Multi-Asset Distribution Fund

Premier Multi-Asset MONTHLY INCOME Fund

4.9 % Historic yield income paid quarterly

5.5 % Historic yield income paid monthly

Risks: The yield is not guaranteed and will fluctuate. Past performance is not a guide to future returns and there is a risk of loss to capital. The value of investments will fluctuate which will cause fund prices to fall as well as rise and investors may not get back the original amount invested.

0333 456 9033

premiermiton.com Find out more:

For investment professionals only. Not suitable for, or to be relied on by, private or retail clients. Source: Premier Miton. The yield reflects distributions declared over the past twelve months as a percentage of the share price of the fund, class C income shares, as at 01.07.2020. Ratings correct as at 30.06.2020.

The Latest Provider Support Offering insight into market conditions and adviser opportunities

FOR INVESTMENT PROFESSIONALS ONLY

Premier Miton INVESTORS

Income focussed

• Premier Multi-Asset Distribution Fund: 50 underlying funds • Premier Multi-Asset Monthly Income Fund: 51 underlying funds • Highly experienced investment team • Research agency rated funds

Key points • Income generating investment strategies • Multi-manager investment approach • Funds include exposure to equities, bonds, commercial property and alternative investments

4.9 %

5.5 %

Premier Multi-Asset Monthly Income Fund

Premier Multi-Asset Distribution Fund

historic yield Income paid monthly

historic yield Income paid quarterly

120

180 160 140 120 100 80 60 40 20 0 -20

Premier Multi-Asset Monthly Income Fund Since launch, 05.01.2009 - 30.06.2020

Premier Multi-Asset Distribution Fund 24.06.2008* - 30.06.2020

100

80

60

40

20

0

-20

IA Mixed Investment 20-60% Shares sector

IA Mixed Investment 20-60% Shares sector

-40

Jan 09

Jan 11

Jan 13

Jan 16

Jan 18 Jan 20 Jun 20

Jun 08 Jun 10 Jun 12 Jun 14 Jun 16 Jun 18 Jun 19 Jun 20

The yield is not guaranteed and will fluctuate. Past performance is not a guide to future returns and there is a risk of loss to capital.

2020 2019 2018 2017 2016

2020 2019 2018 2017 2016

Discrete annual performance to 30.06.2020

Discrete annual performance to 30.06.2020

Fund

-6.4 3.9 2.6 15.8 -0.7

Fund

-7.2 3.2 2.8 14.8 -0.8

Sector

-0.6 2.9 2.4 11.9 1.9

Sector

-0.6 2.9 2.4 11.9 1.9

Distribution history 1

Distribution history 1

7.3p

7.2p

8 7 6 5 4 3 2 1 0

7.1p

7.1p

7.1p

7.1p

6.6p

7 6 5 4 3 2 1 0

6.5p

6.1p 6.2p

6.0p 5.8p

6.2p

5.5p 5.5p 5.6p

5.3p

5.0p

4.9p 5.1p

1.4p

0.8p

1 Source: Premier Miton, class A income shares. Premier Multi-Asset Distribution Fund financial year ending 28 February. 2020/21 includes 1 out of 4 payments. Premier Multi-Asset Monthly Income Fund financial year ending 30 April. 2020/21 includes 2 out of 12 payments. The level of income paid by the fund may fluctuate and is not guaranteed. Performance source: FE Analytics to 30.06.2020, based on a total return, UK sterling basis, net of fees, class C income shares. On 20.01.2020, the funds moved from a single pricing basis (mid) to a swing pricing basis. Performance could be shown on a combination of bid, mid or offer prices, depending on the period of reporting, and is shown net of fees with income reinvested. *Date of change to multi-asset. Ratings as at 30.06.2020.

A Tenet Group Publication

Issue 11 Autumn 2020

SPECIAL FEATURES The Opportunity Behind the Contingent Charging Ban

OTHER FEATURES Helping Attract the Best –

Tenet launch the new Applicant Tracking System and Careers Site

Introducing the Tenet Assistance Programme provided by Care first

Painting a more positive picture

The Latest Provider Support Offering insight into market conditions and adviser opportunities

When your client takes out an eligible health1 or life2 plan with Vitality this summer, they can get up to two months’ premiums back as cashback. All they need to do is complete an online Health Review on the Vitality Member Zone so we can help them understand their health as well as reaching certain activity targets. All they need to do is complete an online Health Review on the Vitality Member Zone so we can help them understand their health as well as reaching certain act vity targets. Offe ends 30 S ptember 2020. Offer ends 30 Septemb r 2020. When your clients get active, they can get up to two months’ premiums back as cashback on a health and life plan. When your clie ts get activ , they can get up t two months’ premiu s back as cashbac o a alt a lif pla . When your client takes out an eligible health1 or life2 plan with Vitality this summer, they can get up to two months’ premiums back as cashback. When your client takes out an eligib e healt 1 or life2 plan with V ality th s summer, th y can get up o tw months’ premiums back as cashb ck. When your clients get active, they can get up to two months’ premiums back as cashback on a health and life plan. When your clients get active, they can get up to two months’ premi ms back as cashback on a he lth nd life plan. When your client takes out an el gible health1 or life2 plan with Vitality thi su mer, they can get up to two months’ premiums back as cashback. All they need to do is complete an online Health Review on the Vitality Member Zone so we can help them understand their health as well as reaching certain activity targets. All they n ed to o is complete an online Health Review on the Vitality Memb r Zone so we can help them understand their alth as well as re ching certain activity targets.

Offer ends 30 September 2020. Offer ends 30 September 2020.

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Do󰇪󰇪󰇪󰇪 󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰 co󰇻󰇻󰇻󰇻󰇻󰇻󰇻 Do 󰇪 󰇰󰇰 󰇰󰇰󰇰󰇰󰇰 󰇰 󰇰 co 󰇻 Do󰇪󰇪󰇪󰇪 󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰󰇰 co󰇻󰇻 󰇻

Selected plans only. T&Cs apply. 1 Each individual Personal Healthcare plan must have a minimum monthly premium from £35. 2 The maximum cashback is £500 per plan – this applies to monthly and annual premium payments. Sel cted plans only. T&Cs apply. 1 Each individual Personal Healthcare plan must have a mini u monthly premium from £35. 2 The maxi um cashback is £500 per plan – this applies to monthly and annual premium payments. Selected plans only. T&Cs apply. 1 Each individual Personal Healthcare plan must have a minimum monthly premium from £35. 2 The maximum cashback is £500 per plan – this applies to monthly and annual premium payments. Selected plans only. T&Cs apply. 1 Each individual Personal Healthcare plan must have a minimum monthly premium from £35. 2 The maximum cashback is £500 per plan – this applies to monthly a d annual premium pay ents.

vtly.co.uk/summer-offer

vtly.co.uk/summer-offer

vtly.co.uk/summer-offer vtly.co.uk/su mer-offer

VitalityHealth and VitalityLife are trading names of Vitality Corporate Services Limited which is authorised and regulated by the Financial Conduct Authority. VitalityHealth and VitalityLife are trading names of Vitality Corporat Services L mited w ich is authorised and regulated by the Fi ancial Conduct Authority. VitalityHealth and VitalityLife are trading names of Vitality Corporate Services Limited which is authorised and regulated by the Financial Conduct Authority. VitalityHe l h and Vit lityL fe are trading names of Vitality Corporate Se vices Limited which is aut orised and regulat d by he Financial Conduct Authority.

WELCOME – 3

Editor’s Foreword

CONTENTS… what’s in this issue

4 P ainting a more positive picture Ben Wright, Business

Development Director, takes a look at the regulatory landscape, which has been primarily dominated by reactive measures to COVID-19.

Welcome to your Autumn issue of selected Despite some tumultuous months, results from our insight survey in mid-June suggest there is a sense of cautious positivity within the directly authorised adviser population at Tenet. In our regular industry update, Ben Wright, Business Development Director, shares these results as well as providing an update on the regulatory landscape, which has been primarily dominated by reactive measures to COVID-19, with a few key exceptions, which Ben will take a more detailed look at in his article on pages 4 and 5. Also in this edition Our Technical Services & Research department’s article “The opportunity behind the contingent charging ban” focuses on how we got here and the way forward, concluding that whilst this ban on contingent charging may result in some advisers having to revamp their approach to DB advice, it should be welcomed and seen as a move in the right direction and an opportunity for good advisers to thrive. Read the full article on pages 8 and 9. Tenet have launched a new system and a new website to help source the best candidates for both your business and Tenet, as well as the ability to track applications and provide a more professional experience. You can find out more on pages 10 and 11. Supplement enclosed with this issue Our supplement – ‘Protection Insight’ is enclosed, helping you focus on the protection market, understand customers’ protection needs and offer suitable solutions. Finally… In addition to our regular events article, with the continuation of our online programme, we also have an article on the Tenet assistance programme provided by Care first. With ever increasing pressures at work and home, there are times when we all need some extra support to balance the demands of everyday life. Care first are an independent, leading provider of professional employee support services and are funded by Tenet, so the service is free of charge for you to use. I hope you find selected informative and useful and as always let us know if you want us to include anything else in future issues. You can email marketing@tenetgroup.co.uk

08

6 Y our Events Programme online Continuing to support your development with all the latest events coming up this Autumn. 8 T he Opportunity Behind the Contingent Charging Ban The ban on contingent charging enables advisers to display the worth of their advice and demonstrate to clients their expertise and knowledge. 10 H elping Attract the Best – Tenet launch the new Applicant Tracking System and Careers Site Helping us draw even more top financial services talent into our member firms.

13

25

12 I ntroducing the Tenet Assistance Programme

Care first - available for all Tenet advisers, free of charge.

PROVIDER SUPPORT 18-36 Latest News and Products

33

Best wishes Katie Nutter Marketing Consultant

WINNER Best Network

Contacts

Editor Katie Nutter

Published quarterly by Tenet Group Limited 5 Lister Hill, Horsforth, Leeds, LS18 5AZ

selected Magazine is for internal purposes only and is not intended as an advertisement. As a result this should not be issued in any form to clients. Not all the products in this feature are the responsibility of the Tenet Group Limited. Terms and Conditions. Although every effort has been made to ensure the accuracy of the information contained in this publication, The Tenet Group cannot accept responsibility for any errors it may contain. The Tenet Group cannot be held responsible for the loss or damage of any material, solicited or unsolicited. No reproduction of any part of this publication, in any form or by any means, without prior written consent from The Tenet Group. The views expressed in this publication do not necessarily reflect those of the advertisers or the publishers.

Tel 0113 239 0011 Fax 0113 239 5322

selected - a Tenet Group publication­

4 – INDUSTRY UPDATE

Painting a more positive picture

Despite some tumultuous months, results from our insight survey in mid-June suggest there is a sense of cautious positivity within the directly authorised adviser population at Tenet. Just under 40% of respondents stated that they were anticipating that their investment and pension business levels would remain the same and 60% anticipated their turnover would either remain the same or increase over the next 12 months. As to be expected, following the initial pandemic lockdown, protection sales increased across the industry and 30% of advisers envisaged an increase in protection business to be sustained throughout the next 12 months. There is still a considerable amount of uncertainty around financial markets at present however, mirrored by our survey results, where 45% of respondents expected markets to bounce back and increase whilst 35% thought the markets would dip further, ahead of a potential recession. Looking to the future, the increased impact of regulation was the main concern of 43% of those surveyed, citing ‘the time- cost’ and ‘financial cost’ of adapting to meet new regulatory requirements as a barrier to business. 29% suggested that the economy and potential recession was their largest concern, whilst only 7% said having to adapt their client engagement strategies were their biggest problem. The fact that a global pandemic and possible recession take second place to the impact of regulation is in itself very telling and illustrates the real pressures that you are under to keep up with and implement the latest output from the FCA. The fact that you purchase compliance services means that you are better equipped than many to keep up-to-date with regulatory changes and we can remove some of the burden of activities via a variety of cost effective services. If you are feeling the pressure, especially in the current climate, please speak to your account manager/regulatory consultant to see how we can support you. If we look at the regulatory landscape, it has been primarily dominated by reactive measures to COVID-19, with a few key exceptions, which we’ll take a more detailed look at now. Update on DB Pension Transfer Advice Regardless of the pandemic, it seems the regulator’s eyes are still firmly focused on DB pension transfer advice, with particular attention unsurprisingly on the advice provided to members of the British Steel Pension Scheme. The FCA’s recent defined benefit transfer advice data request asks specifically about this and its publicity about DB pension transfer advice in general, along with the online advice checker (which is not specific to former BSPS members) means that all firms who have given advice on DB transfers in the past should be familiar with these developments, due to the increased likelihood of complaints being received. Despite this, I think everyone was still surprised when the FCA published its feedback and finalised rules in relation to the ban on contingent charging for DB pension transfer advice in June, as we had been led to believe this would be postponed until the autumn. Broadly, the contingent charging proposals will be implemented as proposed and (with just two relatively minor exceptions) will come into effect on 1st October 2020. From then, unless one of the two specified exceptions applies, clients who transfer DB benefits – whether on a recommendation or on an ‘insistent client’ basis – must be charged the same total level of initial advice/implementation costs as those who receive – and follow - advice not to transfer. A significant departure from the original proposals is that the client will be able to ‘self-evidence’ the two exceptions of serious ill health or financial hardship, but of course, the adviser will be responsible for ensuring that the evidence they rely on is sufficiently robust.

Ben Wright Business Development Director

INDUSTRY UPDATE – 5

We’ve urged you to treat both measures that took effect from 15th June as rules, despite them being in the form of new/updated handbook guidance. The first is in relation to your triage process, and that if it involved any kind of ‘pre-purchase’ questioning such as decision trees or ‘RAG rated’ questionnaires that might help the client decide whether to proceed to advice, then we would strongly recommend that (potential) clients should no longer be provided with access to it, as this would now be seen as advice. The other measure is in relation to cases where the DB scheme is expected to be changed or replaced by another scheme. In such cases, the guidance says that a provisional suitability report (using provisional TVC and APTA analysis) can be issued based on the best information available on the proposed changed/ replaced ceding scheme but the recommendation should not be finalised until the changes/replacement are ‘certain’. If you encounter any such cases and you decide to issue a provisional suitability report, the provisional advice will need to be revisited – and checked by a Pension Transfer Specialist (PTS) if the adviser is not a PTS - once the finalised ceding scheme position is known. If the CETV value changes or if the finalised changes to the ceding scheme are different from those on which the provisional report was based, the recommendation may need to be amended. Equity Release/Later Life Lending – FCA Key Findings On the mortgage front, the FCA published the key findings from its exploratory work on later life lending, specifically the borrowing opportunities available to consumers aged 55+, focusing on lifetime mortgages. To support this work they looked at the sales and advice process for these products by reviewing a sample of case files from a number of firms. Three significant areas of concern were highlighted, namely insufficient personalisation of advice or challenging of customer assumptions and lack of evidence to support the suitability of advice. Several of the FCA’s findings and comments were not dissimilar to those in relation to the DB pensions transfer market, e.g. not to use ‘tick box’ approaches, to capture lots of detailed and personalised information and ensuring that suitability reports are not unnecessarily long. To support firms who are active in the equity release (ER) market, we are delivering ER courses based on demand, which focus on writing compliant business and cover the issues highlighted by the review, so speak to our training team if you would like more information. Temporary changes to regulatory reporting In terms of COVID-19 related changes, in June, the FCA updated its guidance to confirm that it will now permit a two month extension for certain returns due up to and including 30th September 2020. The FCA was quick to remind firms however that the extensions are only intended to accommodate firms who are experiencing difficulties as a result of COVID-19, that have made it impractical to submit the returns listed on time and that firms should otherwise submit their returns without delay. Subject to any significant change in the coronavirus pandemic situation, the FCA has also made it clear

that is has no intention of continuing to offer reporting deadline flexibility after September.

Senior Managers and Certification Regime Implementation – Deadlines Extended The FCA has also extended the 9th December 2020 deadline for the remaining elements of the SMCR implementation to 31st March 2021. Despite this, advisers have essentially been warned not to put their requirements under the SMCR ‘on the back-burner’. Advice firms significantly affected by the coronavirus now have an extended deadline for their first ‘fitness and propriety’ assessment of certified persons in an attempt to alleviate pressure, but this should not be viewed as a concession for all firms to delay their fit and proper assessments. The FCA is still encouraging firms which were able to provide information before the December deadline to do so, stating it still intended to publish details of certified employees on its financial services register starting on that date. In essence, the message from the FCA on all fronts is still very much to carry on as usual unless you have been significantly impacted by the pandemic. New FCA Data Collection Platform - RegData In June, the FCA announced its data reporting system replacement for Gabriel, called RegData. This new platform does not change what you report or the way that you report it to the FCA, but firms will be moved in stages and that there is some preparation that needs to take place, so firms will need to: • Make sure they have up-to-date contact details in Gabriel beforehand; • Have the correct nominated principal user and assigned administer rights; • Have accurate information about all users, with non- active users disabled in the software. We can offer you assistance with preparing your data ready for the change and by utilising our RMAR submission support, you will get peace of mind that the online completion and validation of your regulatory returns has been completed by our expert team. What’s more, for all new users to the service who sign up from now to the end of September, will receive a 25% discount off their first RMAR submission report (usually £270 + vat per submission). To summarise, we’ve been through some extraordinary times over the past few months and we’ve been working hard with our industry bodies, including PIMFA and AMI, as we believe there is more that the regulator can do in these unique circumstances and also that it needs to be pragmatic and give the industry some breathing space to recover from the huge shock that has been dealt to it. Extending the deadline for the SMCR is one such move but we are pushing for more. We would hope that the more recent measures announced it in the Chancellor’s Summer Statement, and the fact that the Government is about to embark on a huge spending programme to kickstart the economy, with the support of massive quantitative easing from the Bank of England, all helps to counteract the fears of a recession and further stimulates activity.

6 – EVENTS UPDATE

YOUR EVENTS PROGRAMME ONLINE CONTINUING TO SUPPORT YOUR DEVELOPMENT

We are pleased to announce that our online events programme will continue throughout autumn, with new events starting in September.

SPECIALIST INVESTMENT WORKSHOPS - TWO ONLINE

We are still able to support your development through these online events, which offer the same CPD that you would expect to receive at our live events, and we encourage you to attend as many online events as possible, not only to satisfy your CPD requirements, but to keep your knowledge and understanding of industry changes and developments at the highest level. All of our events are free to attend, and open to advisers, paraplanners and administrators. To help advisers with the transition to online events, we’ve also updated our Tenet Events App, adding new features that enable you to use the app to complete your reflective statement, view online events, and register for future online events. COMING UP THIS AUTUMN Specialist Investment Workshops - Two Lend - Two Protect - Two Lend Business Focus Event - Two

These events focus on specialist investments and the value they can add to your business. Tenet will utilise the expertise of providers and fund managers, to create a valuable event; giving key industry insights, technical guidance and sales support. The purpose of these events is to provide a higher level of education, through the use of case studies and planning scenarios to provide you with a greater understanding of each product and a proposition’s place in the market. Total CPD Available: 4 hours structured & 40 minutes unstructured Book your place: http://webinars.tenetgroup.co.uk/specialist-Investment-2

Online Event Date

Time

Tuesday 13th October 2020 Thursday 15th October 2020 Tuesday 20th October 2020 Thursday 22nd October 2020

1.00pm – 2.30pm 1.00pm – 2.30pm 1.00pm – 2.30pm 1.00pm – 2.30pm

LEND TWO ONLINE These events will focus on mortgages and lending. They are designed to meet advisers’ development needs and provide a valuable insight into the growing lending market, with sessions from a wide variety of niche and highstreet lenders, packagers and other providers who can help you develop further business opportunities. These events will conclude with sessions from Tenet’s Senior Management and Tenet Adviser Training. Total CPD Available: CPD – 2 hours and 20 minutes unstructured & 1 hour structured CPD Book your Place: http://webinars.tenetgroup.co.uk/lend-two/ Time Thursday 17th September 2020 1.00pm – 2.20pm Monday 21st September 2020 1.00pm – 2.20pm Wednesday 23rd September 2020 1.00pm – 2.10pm Friday 25th September 2020 1.00pm – 2.20pm Online Event Date

EVENTS UPDATE – 7

Online Events available to watch On-Demand If you didn’t manage to view any of online events live, those that have already taken place are available to view on-demand, at any time. Simply use the link below to access all our previous events. https://extranet.tenetgroup.co.uk/tenet-events/on-demand-online-events/ CPD WEBINARS Get your 30 minutes of CPD for each webinar you view! During 2020, Tenet will host a series of 9 webinars on the morning of the last Friday of every month with a single Provider, Fund Manager or Lender. You will have the opportunity to view the webinar and interact with the speakers, asking any questions you may have. So if you need to top up your CPD, take a look at the webinars that are available.

ONLINE ADVISER FORUM 2020

Monday 30 th November – Friday 4 th December Registration Now Open https://events.tenetgroup.co.uk/ AdviserForum2020

Webinars available to watch on-demand

NO 1: Bank of Ireland - ‘Serving the complex customer’ Presented by Lauren Wiles, National Account Manager on 28th February 2020 https://events.streamgo.co.uk/webinar-1-2020 NO 2: Just - ‘Technological Developments – A new approach to retirement income’ Presented by Karl Steadman, Retirement & Later Life Specialist on 27th March 2020 https://events.streamgo.co.uk/webinar-2-2020 NO 3: LV= - ‘Change is the only constant: Are you generation future-proof?’ Presented by Marcus Primhak, Business Protection Product Manager on 24th April 2020 https://events.streamgo.co.uk/webinar-3-2020 NO 5: Zurich - ‘Why Protection Should Be a Keystone of your Clients’ Plans ’ Presented by Andy Woollon, Retail Specialist Presenter on 29th June 2020 https://events.streamgo.co.uk/webinar-5-2020

PROTECT TWO ONLINE These events will focus on the protection market. With Tenet and the industries focus in this area, they are designed to meet advisers’ development needs and provide a valuable insight into this market. All of the sessions at these events will offer IDD CPD. Our Provider partners will also look at other ways you can obtain further IDD CPD. Total CPD Available: Approx. 4 hours and 30 minutes IDD CPD & 1 hour structured CPD Book your Place: http://webinars.tenetgroup.co.uk/protect-two Online Event Date Time Tuesday 29th September 2020 1.00pm – 2.50pm Thursday 1st October 2020 1.00pm – 3.05pm Tuesday 6th October 2020 1.00pm – 2.50pm Thursday 8th October 2020 1.00pm – 2.15pm LEND BUSINESS FOCUS EVENTS – ROUND TWO These events will focus on mortgages and lending. They are designed to meet advisers’ development needs and provide a valuable insight into the growing lending market, with sessions from a wide variety of niche and highstreet lenders, packagers and other providers who can help you develop further business opportunities. Total CPD Available: Approx. 4 hours and 30 minutes unstructured CPD Book your Place: http://webinars.tenetgroup.co.uk/bfe-lend-two

NO 6: The Exeter - ‘An Unhealthy Situation’ Presented by Wendy Ellison, Regional Account Manager on 31st July 2020 https://events.streamgo.co.uk/webinar-6-2020

NO 7: Unum - ‘How to Write Group Risk Business’ Presented by Presented by James Lawley, Adam Aldred and Laura Bilgic, Business Development Consultants, on 28th August 2020. https://events.streamgo.co.uk/webinar-7-2020/

Webinars coming soon.. We recommend registering for all the webinars, then opt out as and when, if you are not available or the content is not relevant.

Online Event Date

Time

Tuesday 3rd November 2020 Thursday 5th November 2020

1.00pm – 2.30pm 1.00pm – 3.05pm

Date

Provider

Monday 9th November 2020 1.00pm – 2.30pm Wednesday 11th November 2020 1.00pm – 2.30pm

25/09/2020 30/10/2020 27/11/2020

Vitality

Precise Mortgages

LV=

To register for any of these webinars visit: https://events.tenetgroup.co.uk/tenetcpdwebinars2020

8 – SPECIAL FOCUS

SPECIAL FOCUS – 9

The Opportunity Behind the Contingent Charging Ban

With the publication of PS20/6, the FCA have sought to remove the conflict of interest that may be evident through contingent charging, which they deemed to potentially incentivise advisers to recommend a transfer. Whilst the majority of advisers may not agree that the move will improve outcomes, the potential for contingent charging to be contributing to what the FCA believes is a high incidence of unsuitable advice was enough to prompt them to act. How Did We Get Here? Since pension freedoms were introduced in 2015, the FCA have confirmed that approximately 235,000 DB members have received advice on transfer values totalling over £80bn. Given the FCA requirement that the starting point for advice should be that a transfer is unlikely to be in the client’s best interests, it is surprising that over 170,000 of these members were advised to transfer benefits to a DC arrangement. These figures are far too high to expect the FCA to not intervene. Now if we assume that each of those 170,000 recommendations to transfer were in the client’s best interests, this could then cast doubt on the numbers quoted by the FCA of individuals seeking advice. In practice, it is likely that there are a large number of potential clients who withdrew from the advice process following triage, the process used to educate clients on the drawbacks and benefits of a potential transfer prior to progressing to regulated advice. However, the FCA have deemed that having over 70% of cases that proceed to regulated advice resulting in a recommendation to transfer is unacceptably high and counter to their initial assertion that it will not be in the best interests of the client in the majority of cases. One of the conclusions drawn by the FCA was that advisers are potentially being financially

should obviously be the outcome. However, clients should not enter the process under the impression that they are paying a fee to potentially facilitate a transfer. It is important to make it expressly clear during initial conversations with clients that they are paying for your expert knowledge and professional advice and that, in the majority of cases, it is highly unlikely to be in their best interests to transfer an existing defined benefit pension. The ban on contingent charging enables advisers to display the worth of their advice and demonstrate to clients their expertise and knowledge. Whilst this may lead to difficult conversations and potentially disappointed clients, the challenge will be to demonstrate the value of a recommendation to remain. This will involve a full appraisal of their retirement objectives and existing arrangements and working to meet these via the lowest risk and least disruptive method possible. The ban on contingent charging may result in a number of DB members being priced out of advice, with upfront fees acting as a barrier to clients with smaller DB pensions. There will always be examples of clients where a transfer may be demonstrably in their best interests but with insufficient liquid cash to cover an advice charge in the result of a recommendation to remain. Whilst these clients may be negatively impacted by these changes, the recently launched client focussed Advice Checker page on the FCA website confirms that a recommendation to transfer where the DB pension is a client’s only or largest guaranteed pension, and where they have few other assets, is likely to be deemed poor advice in the event of a complaint. Whilst this ban on contingent charging may result in some advisers having to revamp their approach to DB advice, it should be welcomed and seen as a move in the right direction and an opportunity for good advisers to thrive.

incentivised to recommend a transfer if their fees are structured in a manner which results in a higher charge following a transfer. Coupled with ongoing advice charges, this can have a significant negative impact on transferred funds and, as a result, the client’s retirement income and financial security. The Way Forward The ban on contingent charging provides advisers with the opportunity to review their advice process and potentially move to an even higher level of professionalism. As qualified specialists, clients should not be paying for a transfer but for the detailed analysis undertaken to assess whether it is in their best interests to take this life changing decision. Many clients may not have realised they were sitting on a pension valued in the many hundreds of thousands of pounds. In these situations, advisers are often faced with clients with a preconceived notion that a transfer is in their best interests due to the large sums made available to them. Given the current financial situation many will find themselves in, with the fallout from Coronavirus still unveiling itself, clients may see the large sums offered by pension trustees as a way of relieving some financial pressure. Clients can often underestimate the true value of the guaranteed income provided by a Defined Benefit pension when faced with an appealing transfer value that can be accessed as and when they please. This lump sum bias can lead to clients identifying objectives that have potentially been driven by the availability of this large transfer value as clients begin to imagine what these funds can be used for. One has to wonder whether the increase in DB transfers in recent years has led to a corresponding increase in the number of campervans being purchased. Clients should be under no illusion that they are paying for a review of their retirement plans and how their existing defined benefit schemes can be used to achieve their objectives. If, following this review, it can be clearly demonstrated that it is in their best interests to transfer their pension, then this

David Lloyd Technical Services and Research Team Leader

The Technical Services & Research team are always on hand to answer any questions you have about anything technical, so feel free to give us a call on 0113 239 0011, then press 2, then 2 again, or email tsandr@tenetgroup.co.uk.

10 – SPECIAL FEATURE

Helping Attract the Best Tenet launch the new Applicant Tracking System and Careers Site

If you’ve visited the adviser jobs section of our website recently you may have noticed a few improvements.

apply for a role within Connect, Select, Lime and Aspire. Some of the features and benefits of the ATS and careers site include: Improved candidate experience – the candidate’s recruitment journey can be tracked at all stages through the ATS so we can now see exactly where any candidate is in the process at any point. We can also send automated emails to keep candidates engaged and up to date on their applications.

The Adviser Recruitment (New to Existing) team have recently introduced a new Applicant Tracking System (ATS) and careers site to help us draw even more top financial services talent into our member firms. The new ATS and careers site is already enhancing the recruitment service we offer to our member firms, raising our profile as a ‘go-to’ organisation when financial services candidates are looking for a new opportunity. The new site also provides a professional and enjoyable experience for those who choose to

SPECIAL FEATURE – 11

Austin Burrell Adviser Recruitment Consultant

Employer branding and awareness – the new site further improves our brand awareness and increases traffic as candidates are directed to the Tenet site to apply rather than applying on a job board. Talent pooling – we now have a functionality to begin building our own pool of talented financial services individuals. Going forward, when the Adviser Recruitment team receives a request from a firm for a new individual, we can check in our own talent pool for people

who have already engaged with us about opportunities and search by skill, experience, location or key words. You can explore the new site and view our current opportunities by navigating through the careers section of the Tenet website or by visiting: https://recruitment.tenetgroup.co.uk/ If you’re thinking of recruiting into your firm, or if you just feel you could benefit from a chat about recruitment, please let us know. Also if you have any friends, family members

or contacts within the financial services sector who are looking for a new role please don’t hesitate to share the link above. Alternatively, you can contact me direct on 0113 239 0011 extension 2232 or email me at austin.burrell@tenetgroup.co.uk

12 – SPECIAL FEATURE

Available for all Tenet Members Care first

Introducing the Tenet Assistance Programme

Who are Care first? With ever increasing pressures at work and home, there are times when we all need some extra support to balance the demands of everyday life. Care first are an independent, leading provider of professional employee support services who employs professionally qualified Counsellors and Information Specialists, experienced in helping people to deal with all kinds of practical and emotional issues. These include wellbeing, family matters, relationships, debt management, workplace issues, and much more… How do I use the service? The service is funded by Tenet and is free of charge for you to use. Just call 0333 212 7712 and you can speak to a professional counsellor or information specialist in confidence. Care first is available 24 hours a day, 7 days a week, 365 days a year and is accessible by phone or online. Care first can provide information booklets, articles, resource information on support services in your local area and even short term face-to-face counselling to help get you back on track. Online Services The Care first Lifestyle website offers extensive resources including articles on health, issues at home, issues at work, management support tools, stress questionnaires and online counselling in real-time.

What do I use the service for? Care first is designed to help you with a wide range of work, family and personal issues. From work-life balance to childcare information, relationships to workplace issues, health and wellbeing. Let Care first support you on the issues that affect all of us at some point in our lives. Topics include, but are not limited to:

• Work-life balance

• Elder care information

• Relationships

• Life events • Immigration

• Childcare information • Health and wellbeing

• Anxiety and depression

• Debt

• Family issues

• Disability and illness

• Bullying and harassment

• Careers

• Education

• Bereavement and loss

• Consumer rights • Workplace pressure

• Stress

Is it confidential? Your organisation or Tenet does not know who uses our service unless the individual personally chooses to tell someone about his or her contact with Care first. We do provide statistics to Tenet Group to show how many members use the service and the broad types of issues that members raise with us, for example; ‘relationship breakdown at home’ or ‘bullying and harassment in the workplace’, so no information is ever passed on which could potentially identify you.

SPECIAL FEATURE – 13

Who answers the phone? If you require emotional support you can choose to hold the line to speak with a Counsellor. Your call will then be answered by a professionally qualified Counsellor at Care first to support you in the moment. Alternatively, if you require practical advice and wish to speak with an Information Specialist you’ll need to press 1 on your telephone key pad. What to expect when you call

What qualifications do the Counsellors and Information Specialists have?

Care first employs BACP accredited Counsellors who are all Management trained and qualified with the minimum of a Diploma. The Care first Information Specialists are all Citizens Advice Bureau trained and are all money trained experts. The Counsellors and Information specialists at Care first are all experienced in helping people deal with all kinds of practical and emotional issues such as wellbeing, family matters, relationships, debt management, workplace issues, and much more…

What will the Counsellor ask me at the beginning of the call?

The Counsellor will ask for your name, this is just for rapport building and will not be passed back to your organisation because the service is confidential - nobody will know when or if you have accessed Care first. However you do not have to give your name if you do not want to. What support will be offered to me? Everyone has very individual needs for support. Care first provides short term solution focussed counselling, so the Care first Counsellor will assess your circumstances when you call to establish what the most appropriate form of support will be right for you. It might be that you just need a brief conversation with the Counsellor that day, or it could be that you may benefit from a few more sessions. Counselling sessions can be provided either over the phone with the same Counsellor you speak to that day, or based on your assessment, it may be appropriate for you to see a Counsellor face to face or access some online based support. How long would I have to wait to see a Counsellor? If following your assessment, it is considered appropriate for you to have face to face sessions or video counselling, these can be arranged within 3-5 working days.

Care first Just call 0333 212 7712 Or visit carefirst-lifestyle.co.uk (Username: tenet001 and Password: group1234) 24 hours a day, 7 days a week, 365 days a year.

What are the benefits of telephone counselling?

Having counselling over the phone means that it’s always on your terms, the service is 24/7 and you’re able to access support in a place that’s comfortable for you to talk. The Counsellors you speak to over the phone are just as qualified as those you may see face to face and it also means that you don’t have to worry about travelling to appointments around your work and home commitments.

16 – PROVIDER SUPPORT

Multi-asset investing

Simon Morris, Premier Miton’s National Business Development Manager, highlights some of the benefits of multi-asset investing and using Connect, Premier Miton’s no-cost online portal to hold and manage your clients’ investments. A popular method of client segmentation when choosing a Centralised Investment Proposition (CIP) has historically been the size of a client’s assets; within this approach multi-asset funds are often used for clients with a smaller asset pot and advisory/DFM model portfolios are often used for higher net worth clients. This method of segmentation has its flaws. Fundamentally, it is not compliant with the Product Governance and Product Intervention Rules (PROD) introduced in January 2018. This is because it is not explicitly driven by and focussed on a client’s needs and requirements and has no direct relationship with the cost of delivering the advice services. PROD requires advisers to identify their target market and build a distribution strategy using information about the client’s needs and status, which could be wealth accumulation, at retirement or post retirement, and investment needs, for example, a regular income, above inflation returns or long-term capital growth. Within these new distribution strategies and in any CIP or Centralised Retirement Proposition (CRP), we believe that multi-asset funds can play an important role. The range of multi- asset funds available means that there are plenty of options to help meet clients’ different investment objectives, which could include building wealth, or generating a long-term sustainable income for retirement. As well as the enhanced diversification benefits of investing across a broad range of assets, multi-asset funds are not restricted to only accessing investments held on a platform as is often the case with a model portfolio. The portfolios are rebalanced continuously, with the fund managers able to manage new inflows to

their funds to the benefit of all fund holders. Using a multi-asset fund also removes potential contractual complications such as the ‘agent as a client’ structure that exists with many DFM models and there is no requirement to provide immediate notification of a 10% fall in the value of the portfolio. Performance is highly transparent, being net of all investment cost and charges, making it easy for advisers to monitor and compare different funds in the marketplace. Post MiFID II, transparency has come into greater focus, with fund providers expected to disclose all costs associated with running a fund, including transaction and research costs. In comparison, it can be more challenging to compare the costs and returns of model portfolios, especially across different platforms. Given the increasing importance of cost and the requirement to be able to demonstrate value for money for clients, Premier Miton has launched Connect. Connect is a no-cost online service which enables advisers to hold and manage their clients’ investments in a range of Premier Miton multi-asset funds. Unlike a platform, there are no adviser or client platform fees to pay thereby reducing the total cost of ownership for clients investing in Premier Miton multi-asset funds. Importantly, the Connect portal puts advisers in control of managing their clients’ investment accounts, 24/7. This includes creating quotes, making applications, organising transfers, fund switching, top-ups, changing income payment choices and generating business and client reports when needed. The portal also facilitates customer-agreed adviser remuneration, full look-through personalised portfolio reporting showing all the underlying holdings within the multi- asset funds, and a choice of income payment options including the facility for dividends to be reinvested, paid directly into a client’s bank account or paid into a product cash account. Connect puts you in control of managing your clients’ investments in Premier Miton multi-asset funds. As the need to demonstrate value for

money increases in importance, we believe that Connect can play a significant part within an advisory firm’s business model. Risks All types of investment carry a degree of risk. It is possible your client could lose some, or all, of the money they invest. The level of risk varies depending on the type of investment. Find out more For more information, including a demo of Connect, please contact our Business Development team on 0333 456 9033 or email info@premierfunds.co.uk. IMPORTANT INFORMATION: For information purposes and only to be issued to investment professionals. It is not for circulation to retail clients. It expresses the opinion of the author and does not constitute advice. Reference to any particular stock does not constitute a recommendation to buy or sell a stock. Persons who do not have professional experience in matters relating to investments should always speak with a financial adviser before making an investment decision. For your protection, calls may be monitored and recorded for training and quality assurance purposes. Financial Promotion issued by Premier Miton Investors. Premier Portfolio Managers Limited is registered in England no. 01235867. Premier Fund Managers Limited is registered in England no. 02274227. Both companies are authorised and regulated by the Financial Conduct Authority and are members of the ‘Premier Miton Investors’ marketing group and subsidiaries of Premier Miton Group plc (registered in England no. 06306664). Registered office: Eastgate Court, High Street, Guildford, Surrey GU1 3DE.

Simon Morris Business Development Manager

PROVIDER SUPPORT – 17

Why Shared Value insurance now resonates more than ever

Deepak Jobanputra Managing Director of VitalityLife

Insurance that gives back This all creates a sense of engagement largely absent in other insurance plans, where the default is to buy your plan, put in a drawer and never look at it until you have to claim. So what Shared Value also does is help to foster a sense of loyalty, because you get something back for the premiums you pay. This doesn’t just benefit the insurer. It benefits the adviser, too, because clients are more likely to recommend more people and, because of the benefits of Shared Value, they also tend to stay longer. Helping create a healthier world There’s a wider aspect to all of this. By helping people stay healthy, society also benefits from a lower healthcare burden – and more productive workplaces, too, by the way. And as we put more into our plans and rewards – continuing to share the value of positive lifestyle choices – we keep the cycle of better living flowing for everyone. It’s why we say that Shared value is good for clients; good for advisers; good for us; and good for society.

Of the many things the Covid pandemic has brought to light, perhaps one of the most relevant to emerge has been how keeping your key lifestyle risk factors under control can be beneficial, not just against the effects of the virus, but for your general long-term health. It’s a point UK Prime Minister Boris Johnson made himself recently, acknowledging how his physical health may have exacerbated the severity of his experience with the virus 1 . To an extent, this is simply re-iterating something we’ve known about for some time: the fact that around 60% of all avoidable deaths in the developed world are linked to four key lifestyle trends – lack of exercise, obesity, excessive alcohol consumption and smoking 2 . By any measure, it’s an alarming statistic, not least for the world of protection in its current guise, which continues to assume that risk is static, evaluated once at the start of the plan and no more. This assumption has always been something we’ve challenged. For example, given these current lifestyle trends, is it really reasonable to think a 55 year old will represent the same level of risk to an insurer as when they took out a plan 20 years earlier? We would argue not, and the evidence would appear to support that. Encouraging positive behaviour change With a core purpose of making people healthier, enhancing and protecting their lives,

we feel we have a responsibility to inform our members what the potential risks of certain lifestyle behaviours are to their long-term health. Furthermore, it’s not enough just to tell people what they’re doing ‘wrong’. We also believe that the best way to change behaviour is to ‘nudge’ it in the right direction. Sharing the benefits through Shared Value The term we use to describe this is Shared Value. Essentially, encouraging our members to adopt healthier lifestyle habits reduces their insurance risk and creates value for us. However, rather than keep all of that ourselves, we choose to share the value those healthy actions create. Call it an incentive. Call it a thank you. Call it a fairer way to do business.

Creating a virtuous behavioural cycle

What this does is help create a virtuous cycle of positive behavioural reinforcement: the more healthy things our members do, the more we can pass the savings those actions create back to them. This can take the form of lower premiums, a range of discounts and regular rewards. Our Optimiser benefit, is available on all our Life plans, illustrates the idea of Shared Value perfectly. When a member takes out their plan, we give them an upfront discount in exchange for annual premium changes based on the level of engagement with their health through Vitality. By taking steps to look after their health – having regular checks, getting active and eating well, for example – they can keep their premiums low for the lifetime of their plan. At the same time, they can also make savings with our partner discounts and rewards.

1. https://www.dw.com/en/uk-launches-campaign-to- tackle-obesity-time-bomb/a-54326794 2. Communicating Non-Communicable Diseases, The Vitality Institute, 2016

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