How will we be using portals in the future?

This week Mark Loosmore of AT8 Group speaks to a range of industry experts about the role quotation portals may play in a post-RDR world

At AT8 we have recently been pondering the importance and future roles of the quotation portals. To give context to our thoughts, we spoke to a number of product providers to gain an appreciation of what role they see the portal playing in the future and thought we would share this with the Professional Adviser readership. We have also spent time with the adviser community and will share their thoughts in a later article.

Protection business

From the research we have completed, the vast majority of business carried out on portals is protection business so we spoke to Richard Leadbeater of LV=, a leading protection product provider, to understand the role he saw the portals playing. Leadbeater was positive about the current positioning of the portals and said the LV= protection products are on all the four portals – Avelo Exchange, Assureweb, Webline and True Potential –which gives them major distribution reach in the market.

However, he believes they will have to evolve in the near future to stay at the heart of the industry. “With the European legislation taking effect at the end of the year with regard to gender differentiation, providers will have one of their key rating criteria removed, arguably 
simplifying the process and devaluing the portal role,” explains Leadbeater.

“The clever portals will see this as an opportunity to rethink their quotation systems and include more rating criteria to avoid commoditisation, in much the same manner as the annuity world has moved,” he continues.

Leadbeater highlights the fact the good advisers already second guess the effect of other rating criteria based on the ‘know your client’ process they have been through, so to bring this formally into the comparison process would add real value and cement their role in the supply chain.

The other area Leadbeater believes is vital for portals to focus upon is integrating to as many systems as possible to move data seamlessly through the advice process. “If portals are integrated in this way their role will be less challenged and they become embedded in the firm’s infrastructure,” he explains.

Annuities and bonds

As well as taking to a leading protection provider, we spoke to David Greenall of Canada Life to understand the role portals played in supporting its annuity and bonds business. Canada Life also has its bonds and annuities available on the major portals.

“We see a two-stage process in quotations”, says Greenall. “Advisers do a comparison up-front to select the product provider but then they often still call our call centre to finalise the quote. They do this to gain access to specific deals, explore niche features not available on comparison sites and to gain help and guidance.”

Greenall did raise a question as to the validity of some of the quotes supported on the portals and whether some providers are choosing not to follow industry standards to the letter so as to gain a competitive edge. Applying different interpretations of items such as maximum and minimum benefits might be used, for example, to move up the lists of comparison sites.