The combination of commission incentives and regulatory developments has allowed a specialised profession to develop, where advisers can help consumers choose the most appropriate products and providers.
An outright ban on commission may only serve to dismantle this model, worsening the gap for those people who should have protection in place. Equally, however, commission levels need to be set at a level that does not overly inflate the premiums paid, threatening the value provided to consumers.
And people’s protection needs change over time and should be constantly reviewed to ensure the products and cover levels in place remain appropriate.
This is a tricky balance to strike, and it is welcome that a proper review be conducted to inform the best way forward.
There are perhaps some wider questions to answer in how we truly address the protection gap, the relationship between protection and investment products and indeed how best to remunerate and incentivise advisers to provide more holistic advice, where they do not already do so.
Hopefully this study presents an opportunity to address these challenges, alongside the more detailed elements of how the market operates.
Jamie Jenkins is director of policy at Royal London
