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UK High Net Worth Independent Financial AdvisersPublished by: Datamonitor Published: Sep. 1, 2005 - 60 Pages Table of ContentsTABLE OF CONTENTS CHAPTER 1 SURVEY INTRODUCTION 9 Introduction 9 CHAPTER 2 THE UK HIGH NET WORTH IFA MARKET 11 Introduction 11 Key findings 11 The more peronalized approach taken by high net worth IFAs allows them to gain a larger share of their clients’ wallet 13 Sole traders are the largest segment of the high net worth IFA market 13 IFAs on average handle 50% of their high net worth clients’ portfolio 15 The IFA channel plays a key role in the high net worth market and provides access to an estimated £232bn in assets 17 IFAs are the most commonly used advisory channel for high net worth individuals 17 The high net worth population is forecasted to reach 1.29 million by 2009 21 The value of high net worth liquid assets will reach £779.5bn by 2009 22 Data tables 23 CHAPTER 3 HOW HIGH NET WORTH IFAS SEE THE MARKET 27 Introduction 27 Key findings 27 High net worth IFAs have a positive outlook for the growth potential of their market 29 High net worth IFAs held a more positive view of providers with strong and flexible investment ranges and strong services 31 Skandia’s strong on-line presence and product strength made them the most popular provider among high net worth IFAs 32 Standard Life was particularly popular among high net worth IFAs 33 Aviva fared poorly with all IFAs 34 IFAs rated Skandia as the best provider of products for their high net worth clients 34 Some high net worth IFAs are dissatisfied with the products availiable to them 36 Poor technical support was seen as the biggest problem with insurers’ SIPP offerings 36 Poor asset allocation tools created problems with insurers’ investment ranges 37 High net worth IFAs have a more positive sales outlook than non-high net worth 38 SIPPs were highlighted as the key growth product by both high net worth and low net worth IFAs alike 39 There is a strong divergence of views over Executive Pension Plans 40 Guaranteed equity bonds remain unpopular among HNW IFAs 40 Data tables 42 CHAPTER 4 ACTION POINTS 44 Introduction 44 Key findings 44 Providers need to go back to basics to succeed in the high net worth IFA market 46 There are three key approaches for insurers to take 47 Providers should ensure their services are focused on attracting high net worth advisers 49 Improvements need to be made in SIPP and investment fund offerings 50 Data tables 53 CHAPTER 5 APPENDIX 54 Definitions 54 Research methodology 55 Netted differences for IFA product attitude 55 Netted differences for IFA provider attitudes 56 Global Wealth Model Methodology 56 Future readings 58 SPP writing team 60 How to contact experts in your industry 60 LIST OF TABLES Table 1: High net worth individuals use of intermediary channels, 2004 23 Table 2: “Who do you see as your key competitors for high net worth clients?” 23 Table 3: UK high net worth individuals forecast 2004-2009 24 Table 4: UK high net worth individuals liquid wealth 2004-2009 24 Table 5: UK IFAs and European wealth managers’ share of wallet 25 Table 6: “How would you describe your typical high net worth client’s occupation?” 25 Table 7: “How would you describe your typical high net worth client’s life cycle stage?” 26 Table 8: IFA survey respondents split by size of IFA firm 26 Table 9: “I believe in the next 6 months the IFA market will” split by type of IFA 42 Table 10: “Which are the most important qualities for choosing a product provider for your HNW clients?” 42 Table 11: “What is your attitude to the following insurers?” split by total responses, HNW IFAs and all other IFAs (excluding HNW) 43 Table 12: “Over the next six months how do you expect sales in each of the following products to change?” split by survey total, HNW IFAs and all other IFAs (Excluding HNW) 43 Table 13: “Which are the most important qualities for choosing a product provider for your HNW clients?” 53 LIST OF FIGURES Figure 1: IFA survey respondents by IFA type 9 Figure 2: Sole traders were the largest segment of high net worth IFAs surveyed 13 Figure 3: Business owners account for the largest proportion of IFAs’ high net worth clients 15 Figure 4: 30% of IFAs reported handling 61-80% of their HNW clients investment business 16 Figure 5: 40% of high net worth individuals use IFAs for advice, making them the most commonly used intermediary channel for wealthy clients 18 Figure 6: IFAs see little threat from non-IFA competitors 19 Figure 7: The UK HNW population will reach 1.29 million by 2009, 2004-2009 21 Figure 8: The value of HNW liquid assets is forecasted to increase on average by 7.1 per cent each year to 2009, 2004-2009 22 Figure 9: HNW IFAs have a more negative outlook for the future growth on the IFA market 29 Figure 10: High net worth IFAs have a more positive opinion than other IFAs regarding providers that place greater emphasis on service 33 Figure 11: Skandia and Aviva were noted as being the best providers for IFAs high net worth clients 35 Figure 12: Although 79% of IFAs were able to meet their high net worth clients’ needs using standard product ranges there remains a core of unhappy high net worth IFAs 37 Figure 13: High net worth IFAs have more positive growth outlook for EPPs, but are more pessimistic about guaranteed equity bonds 39 Figure 14: Product performance and provider service levels were seen as the key qualities for choosing a provider for high net worth clients 46 Figure 15: Three core approaches can be made for those targeting high net worth IFAs 47 AbstractIntroductionIFAs that focus on the HNW population are a key channel for distributing to wealthy customers. Renewed interest in this sector has been driven by three factors: wealth managers' increasing interest in acquiring these firms, the implication of pension simplification for the wealthy, and wrap accounts allowing IFAs to improve the service and profitability of these customers. Scope The report draws on data Datamonitor's surveys of over 400 IFAs throughout 2004 and 2005, including the opinions of 100 high net worth IFAs The report uses data from Datamonitor's Global Wealth Model to estimate and forecast the number of wealthy individuals and the liquid assets they hold Highlights The UK IFA market currently serves approximately 393,000 high net worth individuals, whose combined liquid assets exceed £232bn. Further to this, HNW IFAs handle 50% of their high net worth clients investment and protection portfolio. This makes them the key intermediary channel for providers looking to access the high net worth market. Skandia and Aviva were picked out as being the key product providers for IFAs high net worth clients. Skandia was particularly praised by high net worth IFAs for its on-line offering and strong investment range. However, despite its strong protection products, Aviva was unpopular among high net worth IFAs due to perceived poor service levels. Reasons to Purchase Size the UK high net worth market by the number of wealthy individuals and their liquid assets Gain insight into the attitudes and views of the UK high net worth advisor market Understand how to effectively target the UK high net worth IFA market and how to focus your business proposition. Get Full Details About This Report >> |
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