Skandia launches Adviser Charging conversion process ready for RDR

Skandia is also launching an aligned support programme for advisers to facilitate a seamless transition to its RDR ready adviser charging model.

Skandia is enabling advisers to sign their customers up to adviser charging as and when they see them, via a simple and compliant form.  Forms can be sent to Skandia immediately and the consenting customers will be moved to Adviser Charging on 31 December 2012.  

Skandia's Adviser Charging offers broad flexibility, with monetary or percentage  options enabled across four types of fee:- initial, regular, switch and adhoc fees.

Post RDR, Skandia's existing charging structure will continue for in-force business. To help advisers understand both Adviser Charging and the new trail commission rules, Skandia has produced guidance for advisers, covering key aspects such as:

- Actions which will trigger adviser charging
- Practical advice on how to go about implementing adviser charging
- Considerations to help advisers ensure the best customer outcomes

This will help advisers prepare for RDR as they consider the pros and cons of moving customers to Adviser Charging. The FSA has detailed four key principles with which advisers must comply to satisfy Adviser Charging rules, they are as follows:

- Service and cost: Advisers must make different charging options clear to customers and offer choices. For each option, this must include the services offered and the cost of these.
- Disclosure: Advisers must explain and disclose/illustrate how advice charges impact investment returns.
- Suitability: Advisers must consider the most suitable / cost effective way for customers to pay adviser charges - e.g. from a product, direct to the adviser, or via a platform cash facility.
- Right to cancel fees: Advisers must explain to customers how they can cancel fees and have systems in place to return fees paid after cancellation.

Skandia will help advisers manage these demanding rules and successfully transition to adviser charging.  To keep it simple, customer plan numbers will not change and all advisers' customers on Skandia Investment Solutions will be viewed and managed together on the single platform, regardless of charging structure.

To further support advisers, Skandia will make available from Q3 a demo version of the new online process. This will ensure advisers fully understand how to do business with Skandia in a post RDR environment.

Nick Dixon, Skandia's Marketing Director, comments:

"Advisers can sign up their Skandia customers to Adviser Charging immediately, with Skandia's flexible Adviser Charging system going live in Q4.  Our support programme helps advisers align with the new rules early and protect their income. 

"The move to Adviser Charging must align with four key principles and advisers should check whether their current arrangements with other platforms will be adequate post RDR."