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What does a good suitability report look like?

Are your suitability reports creating a lasting impression, of the right kind? Steve Bailey of ATEB Consulting flags some of the instances of poor suitability reports the compliance company has come across and why getting it right is essential to reduce risk to an adviser business

I’m sure not many would argue when we say that a well written suitability report is one of the most powerful tools in the sales process. It will confirm not only the current advice but, hopefully, pave the way for future sales and help create a loyal and longer-term client. We all seem to accept this principle but ask yourself truthfully, how good are the suitability reports that you produce? Are they accurately constructed with loving care and attention or are they produced en masse from a rather impersonal production line?

We have listed below some common problems that we see on our travels, with our comments under each one. Are you guilty of any of the following?

X               Poorly weighting the content (i.e. unnecessary overkill on say provider information) Pontificating is an art at which insurance companies excel, brief points will suffice.

X               Being too general i.e. ‘Reason What’ report Complete waste of time. These reports offer little protection to the firm and are a breach of the suitability rules. They do not link product features to the soft facts (i.e. Clients wants and desires).

X               Being too technical Confusion is an interesting tactic to deploy and one that we would warn against. It is safe to assume that many of your clients do not know as much as you.

X               Not using the words ‘I recommend’ Unless you are in the business of ‘not giving advice’ you should refer to the ‘reason why’ you recommend and not ‘here are your options please pick one’.

X               Referring to your report as a ‘regulatory requirement’. While this is true, it’s not something I would necessarily need to tell the client.

So what does a good suitability report look like?

                A good suitability report is concise and easy to understand.

                It gives a reasoned explanation of the risks and reasons for recommendations.

                It explains the risks that are specific to the client’s circumstances and the product.

                The report links to the main elements of the discussions that have taken place.

The moral of the story

If you have the view that ‘clients never read suitability reports’ then it’s still worth bearing in mind that ambulance chasers, solicitors, grieving relatives and regulators do and they may all have a vested interest in one of your reports one day in the future. The moral of the story is simple: aim to produce creative and memorable suitability reports and create a lasting impression! There is no doubt that report writing is a personal preference and, arguably, you will never find a system and style that suits all, but we feel that the combination of cutting edge technology, significant flexibility to personalise throughout and relevant content will provide a perfect solution for many firms. We’ve developed a systematic, step-by-step, creation wizard. There is no paragraph selection or cutting and pasting. The content is comprehensive and the document actually looks like a report, not a collection of paragraphs. It is easy to read and allows for the entry of free text for personalisation. Also, the creation process can be delegated easily to administration or paraplanners, freeing up valuable adviser time.

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