IFAs point to speed of Inheritance tax mitigation (IHT) as critical to good customer outcomes in light of Consumer Duty changes

• 93% of advisers say that the speed of IHT mitigation, as well as maintaining access and control over client assets, are the primary motives when recommending BR-qualifying investments to clients²
• When selecting a BR service, IFAs cite the most important factor is speed of IHT mitigation to ensure successful financial planning is delivered to clients²
• 55% believe the biggest challenge is keeping up with regulatory changes such as Consumer Duty, with 66% of advisers believing their own research and due diligence processes will need to change in light of Consumer Duty¹ which will require the whole industry to reset and focus upon good client outcomes, including research houses used by advisers
• 89% of IFAs are nevertheless still planning to grow their BR offering in the next year¹
• Aligned with the Consumer Duty changes, IEP Apex is a BR-qualifying service that includes complimentary IHT cover for the initial 2-year qualifying period paid for by the Manager, meaning no additional cost to investors
• Previously, to achieve IHT mitigation from day one, an investor needed to buy add-on insurance which could cost as much as 13% of the capital invested³

New Ingenious research has revealed that mitigating the effects of IHT, capital preservation and control over assets were listed as first, second and third, respectively, as the most important factors when advising on estate planning¹. Indeed, IFAs cited that having confidence that any IHT would be fully mitigated was the most appealing factor when selecting a BR service. This was followed by factors such as the level of investment risk, level of investment return and costs. 

A staggering 93% of advisers polled cited speed of IHT mitigation, as well as maintaining access to and control of client assets, as the primary motives for recommending BR-qualifying investments to their estate planning clients. The market for BR-qualifying services has traditionally been homogeneous with financial planning success contingent upon investors surviving two years unless an investor pays for additional insurance cover, which could be as much as 13% of the capital invested. Consumer Duty has brought about a renewed focus on good outcomes, however. As a result, IEP Apex is the only BR-qualifying service that fully mitigates the effects of IHT from day one of share allotment by incorporating complimentary IHT cover into the estate planning service as standard, paid for by the Manager instead of the investor.

Over half (55%) of IFAs believe the biggest challenge facing their business in the future is keeping up with regulatory changes such as Consumer Duty. The research also highlighted that in order to align with the new Consumer Duty rules, two in three (66%) IFAs believe their own research and due diligence processes will need to change to demonstrate how ‘good outcomes’ for retail clients will be achieved. When you couple that with the fact that three quarters (74%) of advisory firms surveyed use third party research firms to create BR panels of suitable investment managers¹, this suggests that the way in which advisers work with third party research firms to create such panels also needs to change as part of a industry-wide reset to deliver good client outcomes.

¹Research carried out online with 97 IFAs between 13^th October – 27^th October 2022

²Research carried out via online poll with 436 IFAs in June 2021

³Based on internal research

The new Consumer Duty rules are a catalyst for change and improvement across the whole investment industry. Regardless of your role in the industry, we all have an obligation to deliver good client outcomes. Our adviser survey clearly emphasises the need for estate planning solutions to evolve. We are proud to have worked closely with advisers to create a new service that meets their most pressing requirement, delivering BR effectiveness from day one and for no extra charge. We believe this to be an excellent client outcome.

Neil Forster

CEO at Ingenious

To learn more about IEP Apex, and its additional care service, click below, and one of our team members will be in touch.