Customers who have established trusted relationships with their adviser say that the Royal Commission will have no impact on their advice relationship, according to survey findings released last week by MetLife Australia.
When asked about the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, just over half of consumers (56%) and over a third of SMEs (37%) said it would have no impact on their advice relationship. Further, 38% of SMEs and 20% of advised consumers said it would make them even more likely to visit their financial adviser.
“What’s clear from these numbers is that the Royal Commission has put the spotlight on the need for quality advice and its enduring appeal,” Mr Matt Lippiatt, MetLife Australia Head of Retail Sales, said.
The Royal Commission following months of hearings learnt of serious wrongdoing, including predatory lending practices, involving some of the country’s biggest banks and financial firms.
The MetLife Adviser-Client Relationship Report 2018 study examines consumer and small to medium enterprise (SME) attitudes to purchasing life insurance through an adviser, based on a survey of consumers who currently use an adviser, consumers considering seeing an adviser in the next two years, and SMEs with up to 20 employees.
Overall, the MetLife research data shows that Australians are reasonably happy with the service they’re receiving from their financial adviser, with 61% of consumers and 59% of SMEs rating their adviser ‘excellent’ or ‘very good’. Just 13% of consumers and 11% of SMEs rate their adviser ‘poor’ or ‘fair’.
Honesty and trustworthiness are the top attributes consumers and small business owners look for in a financial adviser, according to the research.
Transparency and experience also rank as key reasons for selecting an adviser. Once the adviser-client relationship has been established, consumer and SME clients expect their adviser to genuinely care about them, speak to them in easy to understand language, and maintain that honesty and trustworthiness.
Mr Lippiatt said, “Given that as many as four in 10 consumers and SMEs have been with their adviser for more than five years, it seems that many clients have established a high level of trust and confidence in their adviser’s integrity and abilities.”
He also said, “However, given that the majority of Australians currently don’t have an adviser, the challenge for us as an industry is to make financial advice more affordable and accessible to the people who need it.”