RDR Update

RDR Update: 2010 - The Time to Act

At the end of 2010, firms affected by the RDR will have the benefit of not only the broad direction of change but the detailed COB Sourcebook to hand. The agenda for change has already been set and firms need to use this time to act in areas such as:

  • New customer journeys - with all the focus on the intermediaries, the change in customer experience and journeys (whether direct or via third-party advisers) needs to be thought through. The ABI has announced its efforts in relation to Simplified Advice models while banks and wealth managers contemplate the implications for their points of sale and integrated communications
  • Distributor impact analysis - with varying estimates of IFA firm and adviser exits versus transfers to Restricted Advice and new entrants, providers need to model the effect on their sales plans and marketing agreements. The overlay of changes is bound to vary both between distribution networks, providers and product ranges. Whilst the effect of capital adequacy changes has been overplayed, the impact of the removal of factoring is hugely significant - opening up new opportunities for providers
  • Positioning and propositions - coupled with Solvency II and ongoing EU changes regarding retail investment sales processes, firms should be assessing the range, pricing and value proposition they will be adopting well ahead of 2013. Providers are already jostling for Restricted Advice panel positions or full joint ventures in the case of bancassurers looking to participate in profits downstream from advisory income. And if commission bias and soft benefits are clamped down upon, how will providers (especially smaller firms) compete for attention? Larger firms are already investing heavily in training support and raising professional standards but what services will be required going forwards?
  • Operational change - even firms that support flexible/nil commission products will find a raft of changes to support a variety of forms of Customer Agreed Remuneration such as upfront fees; stage payments; part retainers; fund deductions; recurring fees etc etc - and of course the provider must validate the customers' agreement. This has implications for quotation and illustration systems; business processing; possibly outsourced arrangements; training and governance - a significant degree of change to couple with Solvency II et al

Bluerock has already been involved in significant RDR related projects, some of them delivering major innovations.  Examples of this include:

  • Strategic level analysis feeding into the agenda for operational change and providing project and programme level co-ordination and resources
  • Drawing on our unrivalled expertise in financial planning tools from business requirements through to bespoke development teams or assisting firms choose a software package
  • Developing entirely new business solutions aimed at filling the much talked-of Advice Gap
  • Renewing and adjusting outsourcing arrangements, governance frameworks and TCF systems
  • Providing skilled consultants, contractors and interims to assist in the development of retail and corporate wraps; SIPPs; risk profiling and portfolio construction tools, including ETF selection engines

If you would like to learn more about our work or to discuss your RDR related needs, please contact Vaughan Jenkins on 0797 1151174 or email