英国のIFA（独立系ファイナンシャルアドバイザー）市場

Abstract

Overview

Introduction

A comprehensive analysis of the IFA industry in 2007, providing a definitive guide to current trends including size, growth, the competitive landscape, and the effects of key issues, recent regulation, and changes in distribution on the evolving segmentation and future development of the market

Scope

• Examines five key product categories; single and regular premium life, single and regular premium pensions, and retail sales of unit trusts and OEICs
• Analyses 2007 Matrix-Data to provide detailed information on the total IFA market and the competitive landscape
• Utilizes data from the ABI and IMA to size the UK market and its key distribution channels, and calculate market forecasts up to 2011
• Interviews with senior executives from both sides of the supply chain form the basis of a comprehensive analysis and forecast of future trends

Report Highlights

Consumers have become well accustomed to approaching IFAs to receive independent advice on a wide range of investment and financial planning issues. It is this familiarity that has a key part to play in the overall dominance of the IFA sector within the distribution landscape of the UK

The RDR, which is currently in its consultative stage, may provide a boost for alternative channels to redevelop and compete on a more equal footing with the IFA channel, by effectively eliminating the category of "General IFA,' and re-organizing industry practice into two categories: "Professional Financial Advice" and "Primary Advice".

Over the past year, partnership activity between providers and IFAs has been feverish, with several of the UK' s leading life providers choosing to acquire well-grounded IFA networks with extensive national reach, such as Sesame and Bankhall.

Reasons to Purchase

• Access Datamonitor expertise, detailed analysis, and extensive primary research to gain an insight into the complexities of the current market
• Identify the current changes taking place in the distribution landscape, and the issues and pressures facing the IFA channel
• Understand the future of the market, and the way in which the IFA channel is likely to develop over the next five years

Table of Contents

• Overview
  • Catalyst
  • Summary
  • Methodology
• Executive Summary
  • The future outlook for the IFA market remains positive
    • IFAs remain the dominant distribution channel and there is little sign that their position will be significantly challenged in the near future
    • The Retail Distribution Review, as it currently stands, may enable alternative channels to compete against IFAs
    • However, the RDR is an ongoing process and there is clearly much discussion still to be undertaken
  • SIPPs, REITs & Wraps are the products currently most in demand by UK investors
  • The increasing number of acquisitions show that companies are making serious headway into the distribution network in the UK
    • Friends Provident' s acquisition of Sesame and AXA' s purchase of the Thinc Group are two of the biggest acquisitions
      • Friends Provident' s moves in the market have been particularly strategic
      • AXA completed its purchase of Thinc Destini
  • There is a tough road ahead for IFAs in having to cope with various regulatory proposals
    • In particular TCF, MiFID, the RDR and increased capitalization of IFA businesses
    • Lack of capitalization is a problem and IFAs must look at securing a recurring income stream
• Table of Contents
• Table of figures
• Table of tables
• Market Focus
  • Market Size
  • Market Drivers
  • Investor desire for self-control has proved a decisive factor in relation to choice of product
    • SIPPs are currently the most popular product among IFAs
    • Adequately servicing the mass market is still a problem area for IFAs
      • Many IFAs have chosen to shift their attention upmarket
      • Some advisors have abandoned specialization in pensions and investments to offer mortgage advice
      • Equity release plans are becoming more popular but there are still few advisers willing to advise clients on them
    • Many IFAs believe there are insufficient income products in the UK market
    • Ethical investments are also receiving some attention, but growth is plagued by a lack of clarification
    • Advisers should therefore take ethical investments more seriously and consider how to appropriately advise clients on them
  • The IFA market sees little competition from other distribution channels
    • IFAs remain the dominant distribution channel and there is little sign that their position will change in the near future
    • The RDR, as it currently stands, may enable alternative channels to compete against IFAs
  • SIPPs, REITs & Wraps are the products currently most in demand by UK investors, and are most suited for IFA sales
  • Technological innovation has centered around fund supermarkets and Wrap platforms
    • Wrap platforms are becoming an increasingly prominent feature of the UK investment market
      • However, some advisers remain skeptical and are not so keen to embrace technological advances
      • The emergence of ' super Wraps' is blurring the boundary between manufacturer and distributor
    • Although fund supermarkets have particular growth potential, research suggests that half of advisers do not use them
      • In spite of slow take-up, fund supermarkets are adding flexibility to their platforms
  • Many IFAs believe the fees versus commission argument to be redundant
    • IFA focus should reside on informing clients of an accurate figure for fees
    • And a move to replace commission with customer-agreed remuneration is welcomed by most in the industry
  • Market Structure
    • The total number of IFA firms in the UK market has decreased by 3% over the past year
    • The number of network members has fallen by almost 35% since 2003
    • Total IFA firm turnover increased by a minor amount between 2006 and 2007
    • The number of IFAs selling life and pensions products has decreased in 2007
    • In addition to the decline in the number of IFA firms selling life and pensions products, the value of sales in this area has also decreased
    • The average IFA firm has experienced a decrease in turnover from life and pensions products
      • However, turnover is largely dependent upon product area
    • Product choice drives turnover
      • Regional IFAs focus on personal pensions, life assurance and investment bonds
      • Network firms are selling the most profitable products
    • Operational structure of IFA firms
      • Just over 80% of the known market has a turnover of less than £500,000
  • The RDR has been the main piece of regulation in the UK IFA market
    • The review looks at areas such as commission structures, bias and low sector profitability
    • There remains widespread disagreement with the points raised in the review and calls for more discussion to take place
      • The review may place a significant amount of pressure on IFAs, whose existence may be under threat as a result of new categorization
    • Industry ' professionalism' should not be solely measured via qualifications
      • Monitoring ongoing professional training would be useful in ensuring advisers have the necessary qualifications and practical experience
    • Debate exists surrounding use of the term ' independent'
      • Introducing maximum commission may be one of the few ways to guarantee consumer confidence and eliminate suspicion of bias
      • A key point to be considered is whether the review will actually result in any benefit for the consumer
    • The RDR is an ongoing process and there is clearly much discussion still to be undertaken
    • The Otto Thoresen review may provide a better idea as to whether a generic advisory concept can be achieved
    • In addition to the RDR, TCF continues to be a serious consideration for IFA firms
    • MiFID is also a consideration for advisers with European clients ahead of the November 1st implementation deadline
    • Research suggests that the FSA is increasingly targeting smaller IFA firms
  • Market Forecasts
    • IFAs' sales of unit-linked bonds are predicted to far surpass that of any other single premium product
    • Savings-related term assurance is expected to dominate the regular premium life market into 2011
    • As for single premium pension products, personal pensions and SIPPs are expected to dominate over the next five years
    • The regular premium pension landscape will be dominated by group personal pensions up to 2011
  • Data
• Competitor Focus
  • Products and Innovation
    • Rather than focusing on specific products/innovation, competitors have tended to shift upmarket
  • There have been some major IFA partnerships, but they seem to have had little effect on the overall shape of the market
    • Friends Provident' s acquisition of Sesame and AXA' s purchase of the Thinc Group are two of the biggest acquisitions
      • Friends Provident' s moves in the market have been particularly strategic
      • AXA completed its purchase of the Thinc Destini Group
      • Thinc has created a portal for non-regulated products
    • Tenet has signed agreements with various providers in order to pick up orphaned clients
    • Standard Life has taken up a 25% stake in Threesixty
    • Aegon purchased five IFAs to create Origen, as well as a 60% stake in Positive Solution
    • This acquisition activity shows that companies are making serious headway into the distribution network in the UK
    • Sesame' s provider survey shows there is still a big gap between the top and bottom providers in the way they interact with advisers
  • There has been a significant amount of M&A activity in the IFA market over the last year
    • Sumus has completed takeovers of both FSAS and Deverill Black IFAs
    • Hampton has created a new IFA firm with the purchase of Victoria Financial
    • Towry Law has moved to pick up the advisers, assets and clients of MLP' s UK division
  • Key Players
  • Turnover per firm
    • Sesame continues to occupy the top spot in the list of the largest IFA networks by turnover
    • The top 10 market players have seen their market share eroded
  • Sales staff per firm
  • Turnover per salesperson
    • On average, smaller IFA networks tend to have more efficient sales forces in terms of revenue per salesperson
    • Sesame leads the pack in terms of the key players in the UK IFA market
  • Sales and Marketing
    • As ever, emphasis on service is the key method of differentiation for the vast majority of IFA firms
      • However, research suggests that IFAs are not providing the high-quality service demanded by clients
    • Attracting new blood into the IFA industry will be a key challenge going forward
  • There is a tough road ahead for IFAs in having to cope with various regulatory proposals
    • TCF, MiFID, the RDR and increased capitalization of IFA businesses will challenge the industry
  • It is crucial for advisers to focus on securing a recurring income stream and better capitalizing their business
• APPENDIX
  • Definitions
    • Single premium policy
    • Regular premium
    • New business
    • Wrap accounts
  • Product definitions
    • Life-based savings products
    • Life assurance
    • Single premium life
    • With-profit bond
    • Unit-linked bond
    • Income and growth bonds
    • Guaranteed Equity bonds
    • Distribution bonds
    • Purchased Life Annuities
    • Other bonds
    • Annual premium life
    • Endowment policy
    • Whole of Life Insurance
    • Term Assurance
    • Income Protection
    • Critical Illness
    • Collective Life
    • ISAs
    • Personal Pensions
    • Stakeholder Pensions
    • Group personal pensions
    • DSS rebates
    • Employer-sponsored stakeholder pension (ESS)
    • SIPPs (self-invested personal pensions)
    • FSAVC (Free-Standing Additional Voluntary Contributions)
  • ABI definitions of distribution channels
    • Independent Financial Advisors (IFAs)
    • Direct sales forces
    • Tied agents
    • Multi-tied agents
    • Bancassurance
    • Direct marketing
    • Telesales
    • Other
  • Matrix-Data definitions
    • IFA firm types
    • Grossed Annual Aggregate Turnover
    • IFA salespeople
  • Methodology
    • Regression analysis is unsuitable forlife and pensions forecasting
    • Datamonitor uses a qualitative forecasting methodology for life and pensions
  • Further reading
  • Ask the analyst
  • Datamonitor consulting
  • Disclaimer
  • List of Tables
    • Table 1: Total number of IFA firms selling life & pensions products, segmented by product, 2006 and 2007
    • Table 2: Contribution of life & pensions products to IFA firms' gross aggregate turnover, 2006-07, (£m)
    • Table 3: Gross aggregate turnover per IFA firm selling life & pensions products, 2006-07 (£000s)
    • Table 4: Total UK IFA firms by turnover, 2006-07
    • Table 5: Sales of single premium life products via the IFA channel, segmented by product type, 2002-06, (£m)
    • Table 6: Sales of regular premium life products via the IFA channel, segmented by product type, 2002-06, (£m)
    • Table 7: Sales of single premium pension products via the IFA channel, segmented by product, 2002-06, (£m)
    • Table 8: Sales of regular premium pension products via the IFA channel, segmented by product, 2002-06, (£m)
    • Table 9: Total number of IFA firms in the UK market, 2006-07
    • Table 10: Gross IFA turnover in the UK, segmented by type of firm, 2006-07, (£m)
    • Table 11: Average IFA turnover, segmented by type of firm, 2006-07, (£m)
    • Table 12: Number of IFAs in the UK selling life and pensions products, segmented by product type, 2006-07
    • Table 13: Number of regional IFA firms in the UK market and their gross aggregate turnover, 2007
    • Table 14: Number of network IFA firms in the UK market and their gross aggregate turnover, 2007
    • Table 15: Forecast sales of single premium life products via the IFA channel, 2007-11, (£m)
    • Table 16: Forecast UK sales of regular premium life products via the IFA channel, 2007-11, (£m)
    • Table 17: Forecast UK sales of single premium pension products via the IFA channel, 2007-11, (£m)
    • Table 18: Forecast UK sales of regular premium pension products via the IFA channel, 2007-11, (£m)
    • Table 19: Turnover of the UK' s IFA networks by competitor, 2006
    • Table 20: Sales size of the top 20 IFA firms in the UK by turnover, 2007
    • Table 21: Turnover per salesperson within the top 20 IFA firms by turnover, 2007 (£000s)
  • List of Figures
    • Figure 1: Unit-linked bonds currently account for more than three quarters of total single premium life sales through the IFA channel
    • Figure 2: Mortgage-related & savings-related term assurance accounts for approximately two thirds of total regular premium life sales through the IFA channel
    • Figure 3: Personal pensions continued to dominate the single premium pensions market in 2006
    • Figure 4: Group personal pensions continued to dominate the regular premium pensions market in 2006
    • Figure 5: Network member numbers have decreased significantly since 2006
    • Figure 6: Network members have declined substantially since 2003
    • Figure 7: Total IFA turnover increased by 1.3% between 2006 and 2007
    • Figure 8: National IFA firms have seen a significant decrease in average turnover per firm since 2006
    • Figure 9: The number of IFAs selling life assurance products has continued to decline in 2007
    • Figure 10: Personal pensions are the most popular product among regional IFA firms
    • Figure 11: IFA Network members frequently sell products that bring in high sales revenue
    • Figure 12: Smaller firms account for more than four fifths of the IFA market
    • Figure 13: Just over 80% of the known market has a turnover of less than £500,000 in 2007
    • Figure 15: Despite strong distribution bond growth, unit-linked bonds will dominate IFA sales of single premium life products over the next five years
    • Figure 14: Distribution bonds will show strong growth over the next 5 years
    • Figure 16: Savings-related term assurance will dominate regular premium life sales into 2011
    • Figure 17: Personal pensions and SIPPs will be responsible for the highest IFA sales in the single premium pension market over the next five years
    • Figure 18: Group personal pensions dominate IFAs sales of regular premium pensions over the next five years
    • Figure 19: Sesame had the largest annual turnover in 2006
    • Figure 20: Sesame leads the way in terms of sales force in 2007
    • Figure 21: Virtual Net Europe and Sesame have the most efficient sales forces out of the top 20 IFA firms in 2007
    • Figure 22: ' Quasi-Delphi' forecasting technique