Friends pushes split commission option on protection

Friends Provident is promoting a mixed commission option to IFAs ahead of the implementation of the RDR.

The structure, a mix of full and non-indemnity commission, was set up in response to adviser demand as well as "the potential changes to remuneration that RDR brings".

It has been welcomed by long-standing proponents of mixed commission options such as CBK Colchester co-founder Peter Chadborn.

"This is something we have wanted as an option for quite some time," he says.

He says protection advisers should have the choice of receiving an up-front payment to reflect their "initial" work, with the remainder spread over time.

The "all or nothing" current options - full indemnity or non-indemnity commission - are testament to why protection is seen as the "poor relation" in financial services, according to Chadborn.

Friends Provident's split commission option is offered via its eSelect system.

Chadborn says it is "unlikely" the Friends initiative is the start of an industry trend of offering mixed commission while Alan Lakey, partner at Highclere Investments, says the outlay needed for the requisite changes to market architecture would be prohibitive.