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13 September 2021
About 58% of self-licensed financial advice practices are more profitable than two years ago despite increased compliance costs, according to a survey by My Dealer Services, which offers support services to advisers.
In other findings, survey respondents say rising staff costs and higher professional indemnity insurance premiums are expenses that could negatively impact profitability.
They say the current compliance regime and exit of experienced practitioners are the key challenges facing the industry going forward.
“The rising cost of compliance is unsustainable in the long run and needs to be addressed as an industry priority,” My Dealer Services Director Alex Euvrard said.
About 98% of respondents say technology will play a bigger role, helping the industry reduce cost and improve operational efficiency.
“Technology will definitely assist in reducing costs, improving client engagement and facilitate and encourage growth through acquisition opportunities,” Mr Euvrard said.
“However, of the challenges ahead, the most crucial is the impact of compliance and regulators need to heed the calls of advice professionals for a more workable and practical framework going forward.”
My Dealer Services says the survey is one of its many programs used to connect with its network of 70 Australian financial services licensees and more than over 240 advisers.