The Consumers Association has been extremely vocal recently, criticising the industry regulator, the Financial Services Authority over endowments.
Whilst many industry commentators have accused the Consumers Association of being on a ‘witch hunt’ and encouraging complaints, this time they really have a point.
The FSA recently issued a consultation paper, which suggested that products like Stakeholder pensions and other products could be given a ‘lighter touch’ form of regulation. They suggested that firms applying this simplified sales regime should not be held liable for poor advice.
The Consumers Association hit back at the proposals saying: “The FSA's preferred option shifts liability from the insurance industry onto the consumer. Consumers’ lives are complex and offering simple products without regulating the advice process will leave them open to the risk of mis-selling with limited access to redress”.
Our View
Regardless of the complexity of savings, pensions and investments, people need advice or guidance at the least. Most people want their savings to work for them for a particular reason. If what they need is going to be achieved, it has to be properly planned and saved for. There is no substitute for proper advice which comes with protection, should things go wrong.
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