One-in-five advisers think the Covid-19 crisis will see more advisers exit the industry than under the Retail Distribution Review (RDR), new research shows.
One-in-five advisers think the Covid-19 crisis will see more advisers exit the industry than under the Retail Distribution Review (RDR), new research shows. A CoreData Research study of 250 UK advisers found 19 per cent think the pandemic will result in more peers leaving the profession than under the RDR, the landmark regulation introduced in January 2013.
The proportion expecting a larger exodus than under RDR increases to a quarter (25 per cent) of mass-market advisers and a third (33 per cent) of those working in the industry for more than 30 years.
Meanwhile, four-in-10 (39 per cent) expect the Covid-19 crisis to widen the advice gap. A higher percentage (58 per cent) of advisers working in the industry for more than 30 years think the advice gap will expand.
Advisers also think the pandemic will herald a fundamental reshaping of the advice landscape. Nearly half (43 per cent) agree the crisis will permanently change the industry. More specifically, about two-thirds (61 per cent) think some advisers will permanently work from home after the crisis. And nearly half (44 per cent) think the impact of Covid-19 means advice businesses with outdated technology will not survive.
The research findings also indicate that the pandemic has had a positive impact on adviser-client relationships. Six-in-10 (58 per cent) advisers say they are communicating more with clients since the crisis and about half (47 per cent) agree their relationships with clients have improved.
“While the crisis has increased the need for advisers to communicate more often with clients, it has also called for them to heighten and refine the support they provide,” says Craig Phillips, head of International, CoreData Research. “The pandemic has given them the opportunity to showcase their soft skills and relationship-building skills and this is resulting in strengthened relationships.”
Elsewhere, as lockdown measures start easing, the prospect of resuming pre-Covid work routines brings anxiety for some. One-in-five (19 per cent) advisers are worried about returning to the office after lockdown. But advisers overwhelmingly think both their jobs and their firms will survive the challenge of Covid-19. Only 5 per cent of advisers say they are worried about losing their job due to Covid-19. An even smaller proportion (2 per cent) are worried their firm will not survive because of the crisis.
