Can you describe the backdrop for financial advisers in the UAE at the moment?
Regulation in the UAE is complicated, particularly for those coming from outside. There are several different regulatory bodies, such as the Dubai Financial Services Authority, Securities & Commodities Association and the Insurance Authority, plus the Central Bank.
In the Middle East – the regulatory landscape is evolving and International life companies have to navigate through the regulatory maze and decide what it means for the way we distribute our products. Our challenge is to establish a robust model that ensures advisers can achieve consistently good outcomes for our clients and all participants in this are sustainable in their offerings.
Is it changing the way advisers operate in the UAE?
Certainly, we believe that advisers that are unwilling to adapt or change will struggle as the regulatory environment develops. Advisers need to be sure their business will be fit for purpose in two, three or five years’ time. They need the appropriate licenses, qualified advisers and a robust client value proposition that they can articulate and the client can understand.
They have a big challenge ahead, to adapt and change their models, but we have found there is a real will to change. They are clearly looking at the types of services they will provide to different types of clients.
What do you believe should be their main priorities as they adapt?
We believe one of the key priorities is for advisers to have a clearly defined value client proposition. As we have seen from more mature jurisdictions such as the UK, it’s not about the fee an adviser charges per se, but about the service that is provided for that fee. In other words, it’s about the client seeing and appreciating the value for money that the adviser is delivering.
Advisers need to build a robust centralised investment proposition in order to achieve consistent and sustainable customer outcomes matching their risk profiles. If the adviser does not have the investment expertise, this may mean the adviser needs to outsource their investment proposition. This is where we can help. We have different options for each customer segment, from our multi-asset Compass portfolios, managed by the Multi-Asset team at Old Mutual Wealth Investment Division, through to our discretionary portfolio management service from Quilter Cheviot.
Where do you consider the opportunities to be in the UAE?
We are seeing increasing demand from high net worth customers for quality tax, pension and estate planning wealth solutions, covering wealth accumulation as well as wealth preservation. The availability of Quilter Cheviot’s full discretionary portfolio management service has further enhanced our high net worth proposition and been extremely well received.
We are very fortunate to have qualified and experienced tax, trust and pension specialists regularly coming to the region as well as having experienced consultants on the ground.
Therefore we are able to offer very compelling wealth management investment solutions for our customers in the region through our diverse distribution channels.
How do you decide on your distribution partners?
We believe it is really important to partner with the right advisers, those with longevity, who want to build strong, long-term relationships with their clients. As such, we prioritise quality over quantity. We would rather partner with fewer advisers, but those where we can really add value to their business.
There are a number of new regulations coming into the UAE. Are you concerned?
Whilst we are supportive of regulatory developments in the region which aim to create improved customer outcomes, we believe more clarity is required on these latest proposals.
Regulations that are aimed at improving customer outcomes have to be balanced so as not to hinder choice and flexibility, and it will be interesting to see how these proposals develop.