New research suggests UK IFAs are losing precious time and money through failing IT.
The results of the survey shatter the myth of independent financial advisers (IFAs) being ‘technophobes’. On the contrary, the level of technology in the average IFA office in the UK is in fact very high. However, IFAs are still suffering a great deal of lost adviser time as a result of IT problems.
A large IFA, employing advisers with in-house IT support, can lose up to GBP48,000 of business in lost adviser time per year as a result of failing IT. The same IFA could also potentially lose GBP84,000 in lost business if they rely on telephone call-out, rather than in-house, support.
IFAs that have in-house IT support lose on average 16 hours of adviser time per adviser per year. This figure is 28 hours for those with telephone call out support. IFAs that take the DIY approach lose on average 36 adviser hours, equivalent to one working week, per adviser per year.
IFAs that submit business electronically expect the average amount of business they submit online to more than double from 19% in 2004 to 44% in 2006. While term assurance is expected to have the highest electronic submission levels among IFAs that submit business electronically, rising from 27% now to 54% in 2006, the fastest growth is expected with mutual funds, with submission levels nearly trebling from 14% in 2004 to 40% in 2006. These figures are 22% and 43% for mortgages and 14% and 38% for life-based saving policies and pensions.
Even an IFA with in-house IT support can still expect to lose up to 16 hours per adviser of adviser time each year, which can be a large cost for the national firms who can be employing several hundred advisers at a time. With the increasing importance that technology plays for the modern IFA, and with ever growing pressure from providers to move to paperless systems, problems with IT are clearly a thorn in the IFAs side, costing them precious revenues.
