Good morning and welcome to your Morning Briefing for Monday 9 December 2024. To get this in your inbox every morning click here.
Royal London launches IHT solution
Royal London has launched a joint life second death life cover option to help clients with their estate planning and IHT mitigation.
The option, available on its Personal Menu Plan, is designed to offer a cost-effective alternative to whole of life cover for those with potential IHT liabilities.
Joint life second death provides a payout on the second person covered if they die or are diagnosed with a terminal illness, during the term of the cover up to age 90.
Don’t underestimate changes to fair value
In days gone by, assessing the value of a service was a simple equation for advisers and wealth managers, largely based on time spent on a client. Under the Consumer Duty, things have become rather more complex.
Despite the Financial Conduct Authority’s ever-greater focus on fair value, many advisers and wealth managers have struggled to get to grips with the changes.
Still more are underestimating how the Duty has fundamentally changed the financial-services landscape.
Firms need to take complaints more seriously
Complaints are a huge part of the financial services industry, unfortunately, so putting things right when they have gone wrong should be a priority for firms, writes Dom House.
According to the latest Financial Ombudsman Service (FOS) data — for the first half (H1) of 2024 — the number of complaints continues to rise across the industry, despite the introduction of the Consumer Duty.
The FOS reported complaints totalling 133,019 between 1 January and 30 June, which represents a 40% increase on 2023’s H1 data.
Quote Of The Day
Markets are calm in digesting the news that the Assad regime has finally collapsed, in a move that weakens allies Russia and Iran and may yet lead to further shifts in the regional balance of power
– Lindsay James, investment strategist at Quilter Investors, gives her latest view on the markets
Stat Attack
Over-50s could be vastly underestimating the value of their home and potentially overlooking the financial options available to them, according to the latest research from SunLife.
SunLife’s third Life Well Spent report surveyed more than 2,000 people over 50 and discovered that, on average:
22 years
the amount of time people over 50 have, on average, lived in their homes.
£148,948
They first purchased them for an average of just under £149,000.
£334,106
These people estimate that the value of their home today is, on average, £334,106, an increase of 124% over the 22 years.
£377,166
However, if they bought their house for £148,948 in 2002 and its value increased in line with the national average, it would be worth £377,166 today, as the average house price has actually risen by 153% since 2002.
£43,060
The amount, on average, by which homeowners over 50 could be underestimating the amount of equity they have.
£62,848
The amount of tax-free cash, on average, respondents who released equity accessed.
57%
of them spent it on home improvements.
33%
paid off debts.
17%
used it to supplement their income.
Source: SunLife
In Other News
Quilter Cheviot has completed the third phase of its long-term investment trust thematic engagement, focused on Real Estate Investment Trusts (REITs).
During this third phase, Quilter Cheviot met with a selection of the chairs, senior independent directors, investment committee members and non-executive directors of eight REITs and three open-ended property funds.
Quilter Cheviot is working to enhance corporate governance practices and responsible investment disclosures within the investment-trust sector, focusing on three areas:
Board composition
Ensuring boards are independent, diverse and possess the right skillset.
Board effectiveness
Boards should challenge the investment adviser when necessary and be accessible to shareholders.
Disclosures
Providing pertinent responsible investment disclosures with real-life examples of stewardship and ESG integration.
South Korean stocks and currency slide after impeachment failure leaves power vacuum (Financial Times)
How the hedge fund magnetar is financing the AI boom (Bloomberg)
China regulators tell banks to expedite offshore company listings, sources say (Reuters)
Did You See?
Financial advisers have a “real opportunity” to educate retail investors, a new survey has suggested.
Finimize’s modern investor pulse survey shows that retail investors want more meaningful financial education from financial brands.
Almost half (46%) perceive financial brands as too similar, while 48% feel that brands often lack a distinctive personality.
Finimize said this comes as 13 million UK adults hold £430bn in cash deposits “that could otherwise be invested”.
A fifth of retail investors want to see more educational content and 19% more financial advice.
