Altus

With the FSA’s latest clarifications on Disclosure, Trail Commission and Legacy Assets, it’s clear that the Retail Distribution Review is moving into the crucial delivery stage. RDR continues to represent a radical agenda, with fundamental changes finding their way into the rulebook.

Undoubtedly the most radical of these is the ban on commission for sales of retail investment products from 2012. Not only will this alter the sale of new policies from 2013, but it will also require changes to how existing policies are serviced to ensure that legacy commission is not paid on advised business. Much has been made of the impact this will have on adviser firms but there are significant operational challenges for product providers.

The removal of commission represents a seismic shift in the relationship between manufacturer, distributor and consumer and should lead providers to spend more effort appealing to consumers rather than distributors. Over the next few years we expect to see wholesale changes to the way products are designed, costed and promoted as providers come to terms with the new RDR world.

In the meantime though, providers need to very quickly get to grips with what RDR means for their operations in the short term as they struggle to support 3 models in parallel; commission (on existing business) plus adviser charging in both its pure and provider-funded forms. To do that they will need a clear picture of what happens now and how RDR will alter that picture; whether it be managing schedules of charges or clearing up after cancellations. Unfortunately, for many insurers, such pictures can be very hard to come by.

Altus understand the complexities of the operational and system changes product providers will need to make to implement RDR. We also understand that whilst 31 December 2012 feels some way off, the complexities of releasing such a change mean the changes need to be finished well before then. Using our RDR expertise can help accelerate your programme:

• Consultancy: Using pre-built logical processes for the new processes you require under RDR means you can concentrate on integrating them into your landscape, not working out what the process needs to achieve. Our packaged solution will get you up and running faster.
• Resourcing: All complex projects benefit from having expert staff, but there’s no time to train people on RDR. Altus have been researching the operational impacts of RDR for two years, and working with our clients to accelerate their RDR programmes. Use our experienced staff to augment your team; whether it’s project leadership, technical architects or business analysis that you need.
• Governance: Are senior management confident that your RDR programme will deliver? Are you worried you may have missed something important? We can provide one-off and/or on-going review of your RDR programme, bringing our change delivery and RDR expertise, and knowledge from around the industry, to you.

To accelerate and de-risk your RDR projects contact us on 01225 472830 or via our website.