Back in my day
Stuart Wilson is chief executive at Air Group
Back in my day, breakfast television consisted of BBC’s offering with Frank Bough and Selina Scott, or TV-AM with, well quite frankly, there were so many presenters that I’ve lost count. Let’s say Roland Rat and leave it at that.
For children, the offerings were even slimmer. How about Swapshop, followed by Saturday Superstore, or Going Live!, depending on your vintage.
I won’t say which category I fall into, but let’s just say that I would often agree with Why Don’t You? and would switch off my tv set and go and do something less boring instead.
Holding the attention of anybody, particularly at breakfast time, is even trickier in this day and age.
Which makes me think of the constant array of sessions available to later life advisers today and, even when we’re all currently stuck indoors for most of the day, there are only enough hours and only enough sessions worth putting the Zoom or Teams on for.
It’s a conundrum, especially when you want to touch base with all stakeholders as often as possible in order to make sure, firstly, that everyone is doing well and coping, but that we’re also able to provide the support and resource that is so important, particularly in the later life sector.
In order to do that, every week we now host a ‘Breakfast with Stu’ event where advisers, providers, solicitors, trade body representatives, you name it, all kinds of stakeholders involved in the later life lending market – get together to discuss various issues around our sector.
It’s a completely informal event and designed to shed some light on the varied and wonderful cases that advisers might be having issues with, or look at wider sector/market issues, perhaps review regulatory action, and so on.
You might expect me to say this, but it’s proved rather successful and each week our numbers tend to grow, not just with advisers fully immersed in the sector but those who are considering their first forays into later life advice.
Such a move can be daunting for that latter group because, as we’re all very aware, later life advice, specifically equity release, is so very different to offering mainstream residential mortgage products.
Advisers who have been active in the later life space for many years will know its requirements intimately, but as the saying goes, ‘every day is a learning day’ and it’s always worth reiterating certain aspects of the process in order to refresh minds or to highlight key differences.
At our recent breakfast session, where we were fortunate to have the Equity Release Council talking about its adviser guides and checklists, a specific topic was raised which highlighted the full ‘belt and braces’ approach that is required when it comes to later life advice.
That area was client Power of Attorney (PoA) and its importance.
We talk a lot in this sector, and rightly so, about potential vulnerability and making sure customers fully understand the sector, the product and the consequences of taking it out.
However, what we may not always remember is that human beings change, and when giving advice we must recognise that and plan for their future.
This becomes even more important with a product like drawdown, where the client can come back and draw down further sums as required.
We know it’s a great product and can help ensure the client is not over-borrowing and taking out a significant lump sum when they only need a smaller amount at that time.
The problem is that, without a PoA in place, if that client loses the ability to drawdown further sums then they won’t be able to access that cash, and neither will anyone else.
The question was raised as to whether it was almost a dereliction of advisory duty to be recommending a drawdown product to the client and not ensuring they/their partner has a PoA in place.
This led to a conversation about whether it was enough to simply evidence that you have recommended a PoA, even if the client does not agree to it.
Of course, at the moment, there is no mandatory PoA requirement with a drawdown, or any equity release client, and if one isn’t being established then certainly as an adviser you’ll want to ensure that your records showed a full and frank discussion took place about this and what the results of that were.
So, perhaps simply evidencing this in a line or two isn’t enough. Firms really need to consider what might be ‘best practice in this area.
If, for example, the client had not agreed to put a PoA in place, then that should clearly be highlighted in the suitability report, which most firms get signed by the client, with plenty of detail on why the client had not agreed to this and outlining fully that they understood the risk involved.
Also, part of the FCA’s focus on lifetime mortgages last year talked about the personalisation of advice, and ensuring records reflected the human being.
When it comes to this PoA discussion advisers have been urged to record those conversations, with the client’s permission, much easier with Zoom or Teams, for instance, and to ensure they reflect the ‘voice’ of the client in records.
That would mean using the client’s exact turn of phrase if the client was not agreeing to put a PoA in place, not simply copy and pasting a couple of sentences into the suitability report.
Should the adviser ever receive a complaint later about these cases, and it is not likely to be the client themselves complaining, but more likely family and relatives, then the records are complete and, with this personalised format, they have greater power to show the discussion was had fully, the consequences were understood, and the adviser’s recommendation was clear all along.
That’s an incredibly important and powerful part of the adviser’s job and their ability to show any interested party the true picture of their advice.
Later life advice has always required a ‘belt and braces’ approach and that hasn’t changed, make sure no-one, is ‘getting up earlier than you’ when it comes to any potential advice challenge, and that clients always get the best advice, whether they accept it or not.