Financial security remains key issue for advisers

Concerns about financial security remain high among advisers and their clients, despite forecasts of an economic recovery in 2010 and recent rises in the stock market.

New research from insurer Zurich has examined the key considerations for advisers when making recommendations about financial planning to their clients.

More than 36 per cent of surveyed advisers rated financial strength as the most important factor when recommending a product to their client.

Reputation was also a key consideration, with 29 per cent of advisers rating reputation of the company to deliver good products and services as the second most important factor when recommending a product.

The findings also indicate that product diversity has an influence on adviser recommendations to clients, with 25 per cent of advisers ranking the range of products available as their fourth priority.

In light of volatile markets, it seems advisers and their clients remain more concerned about the return of capital rather than return on capital, with 35 per cent of advisers citing easy access to capital as the fourth most important consideration in any client recommendation.

Forty-three per cent of surveyed advisers rated flexible remuneration options as their fifth priority in any recommendation.

As well as looking at key factors that influence advisers when making recommendations to their clients, the survey also examined the important considerations for advisers when choosing whether to place business with a life company.

Reputation again rated highly in Zurich's survey, earning the top spot and being voted the second most important factor in any decision making.

More than half of those advisers surveyed (59 per cent) ranked the reputation of the company to deliver good products and services as either the first or second most important factor when placing business with a life company.

In addition it seems that diversity is also important, with 25 per cent ranking the range of products available from a life company as their third consideration.

While reputation and range of products are the key drivers for many advisers when placing business with a life company, Zurich's survey revealed that online support is playing a bigger role in the service mix.

Twenty-eight per cent of surveyed advisers ranked e-capability as the fourth most important factor when placing business in a life company.

Fifty-five per cent of those surveyed cited the range of online planning tools offered by a life company as the fifth most important factor.

Zurich's latest survey also examined advisers' sentiment regarding financial institutions.

Forty-three per cent of surveyed advisers cited a life company as the financial institution they were most likely to trust.

Advisers voted fund managers the second most trustworthy institutions (17 per cent) followed by building societies (16 per cent) in third place.

Fund supermarkets fared slightly less well, with 15 per cent of advisers citing them as trustworthy, followed by banks in fifth place (five per cent).

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