It is now more important than ever to be proactive during this current lockdown phase and keep your clients close to you.
We are in very uncertain and tumultuous times, and you have probably experienced this in your business. Your clients may be, at best, reluctant to invest and, at worst, withdrawing and realising their investment losses. They may have requested premium holidays or cancelled their insurance products, thereby exposing themselves to more risk.
Most of these knee-jerk reactions from clients are part of a collective panic which, in some cases, can be mitigated by open and honest conversations. You can also assist clients with financial solutions. Your clients trust you, and they need to hear from you what Plan B or Plan C is and that you have the solutions to help them deal with their fears and concerns.
Part of this is to conduct your review planning. While FAIS legislation requires you to review your clients’ situations at least annually, it is also a healthy business practice.
Section 7(4) of the General Code of Conduct (GCOC) states:
“A provider who has provided advice to a client or is rendering ongoing financial services to the client in respect of one or more financial products, must regularly (but not less frequently than annually) provide the client with a written statement identifying such products where they are still in existence, and providing brief current details (where applicable), of –
a) any ongoing monetary obligations of the client in respect of such products;
b) the main benefits provided by the products;
c) where any product was marketed or positioned as an investment or as having an investment component, the value of the investment and the amount of such value which is accessible to the client; and
d) any ongoing incentives, consideration, commission, fee or brokerage payable to the provider in respect of such products:
Provided that such a statement need not be provided where the client is aware, or ought reasonably to be aware, that the provider concerned does not render or has ceased rendering ongoing financial services in respect of the client or the products concerned.”
Opportunity to build relationships
A client review is an opportunity to build and nurture relationships with clients and set yourself apart from the competition by delivering exceptional service. Use the review process to remind clients why they have the products you advised them to take out. You can also remind them that the product benefits address the needs and concerns previously discussed with them.
It is also the right time to re-evaluate your clients’ needs and show them the value you are adding to their lives by having a financial advisor to whom they can turn.
Do not try to hide information, or shy away from the difficult conversations. If a client’s investments are performing poorly due to market conditions, be honest about it. Guide them through this time. Unless something has materially changed, encourage your clients to stick to their plans for future financial security. This will set you apart from the rest and build on the trust and relationship.
Conduct remote reviews
The client review process does not have to be face to face, especially during the different levels of lockdown. In fact, it can become really difficult and even risky to set up in-person appointments with your clients.
To mitigate this, you can conduct online meetings using Skype, Zoom, Microsoft Teams and WhatsApp video calls, or make a phone call. If you use one of these tools, make it formal: set a date and time, and send your client an agenda of points to discuss. This increases your chances of securing a review appointment. You will also need to keep a record of your review advice on the client’s file.
Clients need to be informed that this type of communication will be the new normal for a long period, and they should embrace it. But it’s not only clients who should embrace the new normal, as creating new habits starts with you.
If you are unable to set up an appointment with a client, you need to at least send the client an annual portfolio schedule containing investment values, main product benefits and benefit values.
Client retention now is just as important as acquiring new clients. Review planning is a great strategy to protect your business and your clients’ interests.