Depolarisation proposals 'a significant opportunity' - Norwich Union

Article date: 22 November 2002

Norwich Union today welcomed the FSA’s announcement thatit is to proceed with changes to the polarisation regime, whichultimately have the potential to create a more efficient frameworkwithin which we can address the saving needs of the UKconsumer.

Norwich Union shares the FSA’s main objectives ofimproving consumer awareness of the need to save, raising productquality and creating broader access to advice and product choice bystimulating greater competition and innovation among providers anddistributors.

Within any competitive marketplace, participants will thrive ifthey produce products and services which consumers value. Productproviders and intermediaries alike should seek to gain competitiveadvantage through the quality of their products and the strength oftheir brand, without the introduction of artificialconstraints.

A positive outcome for policymakers, the industry and consumershas to include a vibrant IFA sector. Norwich Union thereforewelcomes proposals to abolish the ‘better than best’rules. The IFA market needs capital to drive distribution,innovation and technological efficiency. Both providers andintermediaries should, therefore, be free to enter into commercialrelationships which make sound business sense and address the needsof their customers, whether this means dealing with the wholemarket, or with a limited number of providers.

However, we believe that investments made by product providersshould be structured on an arm’s length, but supportivebasis. All such investments must be fully transparent. Getting theright level of transparency will be vital to ensureconsumers’ confidence. The FSA is right to look at developingrules that ensure that ‘independence’ is notprejudiced.

We are also pleased that the FSA is to develop the so- called‘Menu’ option - devised by AIFA and IFAP in conjunctionwith a number of leading product providers including Norwich Union.This should provide a workable alternative to the Defined PaymentSystem that would build on best practice within the IFA community,to make the cost and value of financial advice more visible toconsumers at an early stage in the sales process.

Norwich Union already works with a variety of distributors andadvisers and we are well placed to take advantage of theFSA’s proposed changes.

However, change will require carefully thought out regulationwith appropriate transitional arrangements to ensure a robustmarket for advice is maintained which is accessible to all consumergroups.

Commenting, Peter Hales, Sales & Marketing Director forNorwich Union, said: "This is a major development for the industryand a significant opportunity for opening up the market for adviceto more consumers. It also presents a real opportunity for IFAs tocontinue to develop and prosper. Norwich Union are delighted tohave had an opportunity to have been actively involved in theconsultation process, and we will continue to contribute positivelyas this progresses to the next stage."

Notes for editors

  • Norwich Union is the UK’s largest insurer. It is theUK’s largest provider of life, pensions and investmentproducts and one of the leading IFA providers. IFAs provide around75% of the company’s long-term savings business.
  • Norwich Union has strategic alliances with building societiesand other leading UK brand names including Tesco Personal Financeand The Royal Bank of Scotland Group.
  • Norwich Union’s news releases are available on the Avivaplc website at
  • A selection of images are available from the Norwich UnionNewscast site at

Press office contacts:

James Evans, Norwich Union Life 08703 66 68 78
Out of hours 07790 487105
Ian Beggs, Norwich Union Life 08703 66 68 71
Out of hours 07790 487533
Louise Goffee, Norwich Union Life 08703 66 68 70
Out of hours 07810 057362

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