We’d like to remind Forumites to please avoid political debate on the Forum.
This is to keep it a safe and useful space for MoneySaving discussions. Threads that are – or become – political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!
The Forum now has a brand new text editor, adding a bunch of handy features to use when creating posts. Read more in our how-to guide
IFA fees
gurps_cov
Posts: 12 Forumite
I became a client of a IFA recently. I went to see him about retirement planning and life cover.
He explained to me that he does either fee based work or commission based work.
He found the following products for me:
- collective retirement account (pension fund)
- Life assurance
- Family income benefit
- Income protection
The work for all of the above was commission based.
We then progressed to filling in the application forms for each of the policies.
The pension fund started without any issues.
The life cover, income protection and FIB took a while to progress since the product providers took a while obtaining doctors reports, medical test results e.t.c.
The documentation received from the product providers show that all three of the policies have a 30 day cancellation clause in which any premiums will be refunded.
The life assurance annd FIB policy began a few days ago but the Income protection has not started since they are waiting on my signature for acceptance of terms.
I called my IFA up and told him that I changed my mind and that I only want to go ahead with the Life assurance and I want to drop the FIB and Income protection.
He wasn't happy. He said that I would have to pay a fee for the work that he did since the product providers would exercise 'commission clawback'. Apparently he had already been paid the commission.
Where do I stand with something like this? The work he did for me was purely commission based. I looked at his terms of business letter and it states:
'For the implementation of some contracts, 'ACME Ltd' will receive indemnity or "initial" commission from the product provider. This commision will be disclosed to you in writing. If you cease to maintain premiums beyond the 'cooling-off' period and prior to the end of the earnings period, the policy provider may 'clawback' somoe or all of the commission paid. We reserve the right to reclaim this from you where appropriate.
It doesn't actually state the duration of the cooling off period. I assume this to vary between financial products.
My policies clearly state a 30 day cancellation period. I understand this to be the 'cooling off period'.
Does this guy have a right to ask me for fees for the investigative/research work he did to find and apply for the products mentioned above? We didn't agree on any fees to begin with and I should be entitled to cancel within 30 days without incurring any costs.
Any advice appreciated.
He explained to me that he does either fee based work or commission based work.
He found the following products for me:
- collective retirement account (pension fund)
- Life assurance
- Family income benefit
- Income protection
The work for all of the above was commission based.
We then progressed to filling in the application forms for each of the policies.
The pension fund started without any issues.
The life cover, income protection and FIB took a while to progress since the product providers took a while obtaining doctors reports, medical test results e.t.c.
The documentation received from the product providers show that all three of the policies have a 30 day cancellation clause in which any premiums will be refunded.
The life assurance annd FIB policy began a few days ago but the Income protection has not started since they are waiting on my signature for acceptance of terms.
I called my IFA up and told him that I changed my mind and that I only want to go ahead with the Life assurance and I want to drop the FIB and Income protection.
He wasn't happy. He said that I would have to pay a fee for the work that he did since the product providers would exercise 'commission clawback'. Apparently he had already been paid the commission.
Where do I stand with something like this? The work he did for me was purely commission based. I looked at his terms of business letter and it states:
'For the implementation of some contracts, 'ACME Ltd' will receive indemnity or "initial" commission from the product provider. This commision will be disclosed to you in writing. If you cease to maintain premiums beyond the 'cooling-off' period and prior to the end of the earnings period, the policy provider may 'clawback' somoe or all of the commission paid. We reserve the right to reclaim this from you where appropriate.
It doesn't actually state the duration of the cooling off period. I assume this to vary between financial products.
My policies clearly state a 30 day cancellation period. I understand this to be the 'cooling off period'.
Does this guy have a right to ask me for fees for the investigative/research work he did to find and apply for the products mentioned above? We didn't agree on any fees to begin with and I should be entitled to cancel within 30 days without incurring any costs.
Any advice appreciated.
0
This discussion has been closed.
Confirm your email address to Create Threads and Reply
Categories
- All Categories
- 354.3K Banking & Borrowing
- 254.4K Reduce Debt & Boost Income
- 455.4K Spending & Discounts
- 247.3K Work, Benefits & Business
- 604K Mortgages, Homes & Bills
- 178.4K Life & Family
- 261.5K Travel & Transport
- 1.5M Hobbies & Leisure
- 16K Discuss & Feedback
- 37.7K Read-Only Boards