2 February 2018 07:00
Despite the consolidation in the industry, the interest of the client must remain a priority for the advisors and market intermediaries.
This reflection is that ofEvelyne Verrier, a partner at Lavery. It was shared during a lecture given at the occasion of the most recent Congress in 2017 of the insurance and the investment.
«The Face of all this consolidation, challenges remain. The best interest of the client must be prioritized. Act as advisor conscientious, disclose business links, respect the rules concerning conflicts of interest, be at the heart of ensuring impartiality and independence in spite of all these movements to be at the cutting edge, » she explained.
Parallel with the draft law 150
To Me, Glass has drawn a parallel between bill 150 proposed by the minister of Finance Carlos Leitão in the insurance industry of damage and the situation of which is witness the market of insurance of people. In particular, the draft law suggests the rule of 20 %, the limit of participation of an insurer or a financial institution can hold in a firm. A firm cannot be registered as a broker-dealer if the participation of an insurer or of a financial institution exceeds the threshold of 20 %, in which case registration shall be made as an agency.
«When a brokerage firm should become an agent because of all the rules on the investment and financing, this has an impact on the liability. The level of responsibility of the insurer facing an agent versus an independent broker is not the same, » she said.
Access to finance
Therefore, whether in life insurance or in damages, the stakes in the face of the consolidation are the same, and he summed up Me Glass. «The costs of compliance and technology are growing. Firms no longer have the choice to have access to financing and a strong shareholder, » she added. This forces some firms to turn to insurers or financial institutions to do this.
And if the rule of 20 % was applied to the insurance of persons, what would happen ? Me Glass said to ignore the answer. The question raises several others, » she says.
The fundamental issue of the independence
Among the challenges posed by the consolidation, of independence is fundamental. Me Verrier pointed out that it is necessary to consider the level of involvement of the acquirer or lender.
«Is that a firm will keep its own counsel, its own rules of governance, what will be the level of influence ? What would be the rules in relation to bonus and sales quotas ? The advisors would they always have access to a wide range of products, to maintain the diversity of products that implies the independence ? «she particularly questioned.