The Plight of the Commission Sale

It’s only a matter of time before commission based investment products cease to exist.

In October of 2009, the Association of British Insurers called on the European Commission to deliver a framework for removing remuneration bias as well as other changes in the way retail investment products are sold. How long will it be before this is a reality in Europe and North America? Or better yet, how prepared will you be to change the way you’ve always done business?

The ABI urged the EC to:

- put the needs of consumers first when thinking about any new regulatory framework for PRIPs at a European level;

- recognise the importance of increasing consumers’ savings and encouraging a competitive environment between different product types and manufacturers;

- focus on the economic purpose of a product, rather than its legal form – equivalent products should have equivalent regulatory treatment;

- recognise that consumers want, need and deserve a regulatory framework for selling practices that focuses on their needs, treats them fairly, enables them to understand the sales process and ensures that financial advice is not biased by remuneration arrangements with product providers.

Read full articles – Article 1 | Article 2.

Download the Packaged Retail Investment Products (PRIPs): New Ways of Thinking