Thanks to recently released research figures delineating the problem, the majority of advisers have expressed concern in their ability to demonstrate ongoing and initial due diligence in their recommendation efforts regarding professional indemnity insurance claims by their clients.
A survey conducted by Capita Financial Software, in which more than 200 respondents were polled, collected data that revealed that a mere one in five adviser firms could express high levels of confidence in regards to proving the due diligence requirement of their professional liability insurance cover had been fulfilled
Capita Financial stated that business liability insurance policies can face invalidation, leaving advisers with the grim reality of watching their insurance premiums rise dramatically if they cannot demonstrate their policies’ due diligence thresholds were met properly.
William Watling, director of business development for Capita Financial Software, commented on the research findings, stating that the survey’s results showed that there is a great concern amongst a particularly significant percentage of adviser firms in regards the due diligence and other related legal factors involved in using platforms with their clients.
The research findings, which were conducted via a partnership with both The Platform and AT8 Group, will be available in white paper form from Capita Financial Software set to be published presently entitled ‘Platforms: Big Issues and Big Solutions.’
The research also revealed that ar 44 per cent, less than one out of two firms who participated in the study could claim confidence in their preparations for the beginning of platform adviser charging, which will go into effect in 2012. At 11 per cent, one out of every ten firms claimed they had absolutely no preparations completed at all.
When questioned regarding the issue of whether advisers have the right to refer to themselves as independent if only utilising one platform, the respondents were more less split down the middle, with 44 per cent coming down for ‘Yea” and 40 per cent for ‘Nea.’