Mr Orton predicted that the number of entrants in the platform market will increase in the short term, since many insurers are keen to get involved in one of the biggest growth sectors. At the same time, he anticipated that some new entrants will “run out of patience” in the medium term and exit the market.
Irrespective of how things play out, he said extra competition will ultimately ensure that every provider is required to demonstrate value. This includes promoting transparency, an absence of which has been one of the main criticisms aimed at the sector since its inception.
Many have complained about the complicated fee structures attached to platforms, and the inability to accurately assess fees due to controversial charges for reinvesting dividends and exiting.
In order to reach the next level, Mr Orton urged the industry, as a matter of trust, to make clear its charges. However, he said this should not mean providers are confined to one type of fee structure: whether tiered or fixed fees are applied, the key issue is that the costs involved are made plain from the outset.
Aside from solidifying Aviva’s relationship with advisers, Mr Orton has also been tasked with overseeing the launch of the insurer’s execution-only platform, which is set to be rolled out in the first quarter of 2015.
He said it was inevitable in the digital age for more and more people to go it alone in their financial decision-making, and hinted that the insurer’s offering will be unique in offering a specific focus on at retirement needs.
But despite recognising changing trends in human behaviour and the impact that the RDR has had on the affordability of financial advice, he said there will always be a place for the profession. And while he warned advisers to evolve as advice becomes more of a “scarce commodity”, he likened their value to that of medical professionals.
People, he claimed, have become more “discerning” about when they need advice, and are now willing to consult a professional only in certain situations. To continue his medical analogy, this means consumers are happy to put a plaster on a cut, but they will seek out a specialist when they break a leg.
Daniel Liberto is a former features writer at Financial Adviser
