Effective jargon-free communications are crucial for advisers and Financial Planners in delivering value for money under Consumer Duty, according to new research.
More than a third of investors (37%) said they would use the quality of communications to assess advisers’ performance.
The survey from Hymans Robertson Investment Services also showed that 37% of consumers would like a summary of key points added to the communications they receive, while a quarter would like less jargon.
William Marshall, chief investment officer at Hymans Robertson said the results highlight how important it is for advisers to assess their communications before the Consumer Duty deadline.
He said: “For many firms, preparing for the Consumer Duty’s implementation deadline has been one of the biggest undertakings they’ve had to take on for a long time. A key part of the regulation is being able to demonstrate that the service they’re providing clients offers value for money.
“By this point advisers are likely to have a firm grasp of their Consumer Duty-related processes and frameworks that they’ll use for monitoring and outcome-related record keeping. It’s important for them to have factored in how they will evidence this, and also that they’re aware if their communications are suitable for the intended audience.”
He said communications have a key role to play in helping consumers have confidence that they are getting value for money and it will also make them feel supported and well-informed.
The FCA’s final guidance covers communication throughout, he pointed out. “A main takeaway is that advisers need to ensure the materials they provide are appropriate for their target audience, are clear and make the right considerations for behavioural aspects.
“Although this regulation is untested, firms who have taken preparation seriously and developed a plan which they can follow will be in a strong position. They’ll be able to identify how they’re offering value for money for their clients through things like their communications and also importantly be able to evidence this as part of their compliance.”
