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Do I have to pay £1000 to the IFA?

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Comments

  • ACG
    ACG Posts: 24,709 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    Kumamon wrote: »
    ACG, thanks for your answer, it was really helpful. Sorry for my flippancy saying 'it was only an hour's work'. I am annoyed at myself more than anyone else.

    He is offering the option to cancel the new policy and reinstate one with him, I am looking into whether that would mean any penalties for me with the company who set that up. I didn't sign anything about 'claw backs' with them, so that should be an option. Though I'm loath to commit myself for another 4 years with the IFA which is what he wants.

    Ask the IFA for the contract you signed which stated you would pay back any clawback if the policy was cancelled. If there is not one, then I can not see how it would be enforceable

    As for avoiding IFAs (I am not one, I am a Mortgage Broker but we do Insurance), they (IFAs) are a very good place to start when looking at advice and help setting up insurance/pensions/investments etc - better than some banks if that is the alternative. I would not rule out dealing with IFAs in the future, it just sounds like you have copped for one whos policies you do not really agree with - I have tried to sit on the fence and not take sides as I can see both sides to this argument.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Kumamon
    Kumamon Posts: 18 Forumite
    Thanks ACG.

    And I can see his side too. I did sign the form, and it did talk about claw backs. There was no amount though for how much the commission was - that part hadn't been filled out. I have no record of being given an illustration which says how much it could be - he might have said over the phone, I don't remember.

    I started this thread as I didn't want to compound my mistakes and wanted some different opinions. I've had them, and I am very grateful for that. I'll certainly be more careful - and while I'd rather not work with him again - I understand that IFAs can be a worthwhile investment, as long as I know how much I am potentially investing.
  • dunstonh
    dunstonh Posts: 120,198 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    .. and most IFAs do not do mortgages or insurance. So, one that does is in a minority. Nowadays firms mainly use mortgage advisers for the mortgages and insurance and IFAs for the investment class business. its hard to be a jack of all trades nowadays.
    And I can see his side too. I did sign the form, and it did talk about claw backs. There was no amount though for how much the commission was - that part hadn't been filled out. I have no record of being given an illustration which says how much it could be - he might have said over the phone, I don't remember.

    it would have been on the life assurance quote and supplied again by the provider with the cancellation rights.

    Did you agree a fee and use the commission offset (the good way)? Or is this person saying you are liable for the whole commission (minus the amount not clawed back) - the not so good way - but still allowed.

    There are some providers that have a two year clawback period. Maybe tell him to limit to those so you end your relationship after 2 years.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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