Nigel Waterson, Chairman Welcome and thanks Apologies Minutes To - - PowerPoint PPT Presentation

Equity Release Council GCM 6th October 2014

Nigel Waterson, Chairman

Welcome and thanks

Apologies

Minutes

To approve the minutes of the last GCM held on 5th December 2013

Membership update

At Oct 2013

• Firms 88, Individuals 246

At Feb 2014

• Firms 99, individuals 318

At Apr 2014

• Firms 103, individuals 321

Now Firms 105, Individuals 344 Additionally, 9 firms and 13 individuals currently going through the application process

In 2014 The Council has increased its focus on national and consumer media to: This has involved:

PR – mainstreaming equity release

Educate consumers & tackle common misunderstandings Position ER as a mainstream financial product Maintain The Council’s reputation as a voice of authority

• n all relevant

topics Support engagement with existing and potential members Stimulate discussion of consumer attitudes towards equity release

Using official data and research to show how ER can be 1 of the solutions to relevant consumer issues, savings & retirement Launching quarterly consumer campaigns & the 2nd Market Report – point of reference for the industry Building and cultivating relationships with key journalists

The Council in the news

Between 01 Jan – 25 Sep 2014, The Council has:

• Issued 18 responsive comments on pressing social /

economic issues

• Issued 11 news stories to national, consumer, trade / broadcast

media

• Issued 29 regional news stories to local / broadcast media
• Answered over 100 journalist queries for data / commentary
• Given 15 radio interviews targeting national / regional

audiences

Building greater profile

So far in 2014 The Council has achieved 431 pieces of coverage with an estimated value of over £2.5m and circulation of 75.7m

National media now accounts for 18% of all coverage compared with 16% for the same period in 2013

Coverage Highlights

Coverage breakdown

3% (15 pieces) 47% (203 pieces)

28% (122

pieces) 18% (73 pieces) 4% (18 pieces)

Broadcast Trade Regional National Consumer

57% 14% 16% 15%

Trade Regional National Consumer

Jan 1st 2014 – Sep 25th 2014 Jan 1st 2013 – Sep 25th 2013

Key radio appearances

The Council has made a number of radio appearances to discuss equity release, including:

• LBC Radio to analyse the Council’s research on new year financial planning
• BBC Radio 2 Drive Time discussing the Council’s Q4 2013 results
• BBC Radio 4 Today programme highlighting the growth of equity release and Q4 2013

results

• BBC Radio 5 Moneybox as part of a panel answering listeners’ questions on equity

release

• BBC Radio 4 You and Yours to discuss the Council’s Q1 2014 results
• Kingdom FM on latest research into attitudes towards home improvements later in life

Total estimated audience January – October: 25m plus

Market Report Autumn ‘14

90% of new equity release plans taken out in the first 6 months of 2014, alongside data from over 37,000 new plans up to 2013

Explored:

• Customer profiles and trends including age, gender and property

wealth

• Product uptake including product choices and typical borrowing
• Personal borrowing rates tracker for equity release versus other

forms of borrowing

• Regional breakdown of retirement income gained from equity

release

• Lump sum and drawdown consumer case studies

Market Report findings I

• 18 months of retirement income through ER for over 55s
• Sustained rise in the average age of ER customers
• Drawdown products attract on average older people than lump

sums

Market Report findings II

• 5% increase in joint loans in H1 2014
• Regional breakdown of ER

trends incl. how many years it adds on to retirement income

Social Media

Between Jan and Sep 2014, the Council has:

• sent 202 tweets promoting its latest

initiatives and industry news

• prompted 102 re-tweets to get the message
• ut to a wider audience
• received 525 clicks straight through to its

website/ related pages

• increased follower base by 11% compared

to this time last year with 701 followers, including advisers, providers, journalists, publishers, think tanks and other influencers in personal and retirement finance

Website

The Council’s website is consistently getting a high number of hits.

Between Jan – Sep 2014 the website received:

165,554 total pageviews 9,867 member directory visitors

Out of the total visitors:

76.11% new visitors 23.89% returning visitors

9,867 165,554 Member directory visitors Total number of visitors

76.11% 23.89% New visitor Returning visitor

On the PR agenda for this year

• The Council’s quarterly consumer campaign will use bespoke

research on over-55 personal finance trends and show how equity release can be of use

• A rolling schedule of industry comments, press meetings

and social media activity will continue to highlight The

Council’s work to a wider audience and promote the role that equity release can play in retirement

Public Affairs review

From a Public Affairs perspective the Council was and is actively working for positive changes on:

• Care Act
• Pensions Reforms and the Guidance Guarantee
• EU Mortgage Credit Directive
• Solvency II

Care Act

The Council’s response focused on the issues of imposing charges and assessing financial resources The Council stressed that people should be able to access independent advice before taking out complex financial arrangements, ie DPA The Council is monitoring for the gov. response & further consultations by the DH

• The Care Bill was given Royal Assent & became the

Care Act 2014 in May 2014

• DH launched a consultation on draft regulations &

guidance for Part 1 of the Act

Pensions Reforms & the Guidance Guarantee

• Freedom and Choice in Pensions & free & impartial

face-to-face guidance as of April ’15

• The amount of total pension savings that can be taken

as a lump sum increased from £18,000 to £30,000

The Council’s called for advice to be impartial, holistic & personalised, stressing that housing wealth should be included – DC pension schemes The Council highlighted that our members already abide by a CoC similar to FCA proposed standards - should be a model for the rest of industry The guidance guarantee will be made available through independent 3rd parties to ensure complete impartiality The Bill brings in measures to implement pensions

• proposals. The

Council is preparing written evidence & possible amendments for the Public Bill Cttee

EU Mortgage Credit Directive

The Council is responding to HMT’s consultation, which is seeking feedback on the proposed steps for the UK to meet its obligation to transpose the MCD FCA confirmed to redefine ER lifetime mortgages to comply with the MCD and published a consultation on MCD Implementation and the new regime for 2nd charge mortgages The Council is having ongoing discussions with FCA on the

• subject. We are stressing need

to avoid a parallel regulatory regime for ‘Equity Release Lite’

MCD - adopted by EU Parl. and Commission in Feb - renders residential mortgages secured against the borrower’s home and any other lending where the purpose is to acquire/retain property rights

Solvency II

The Council met and shared response with Jon Rouse, DG, Social Care, Local Government & Care Partnerships Rouse recognised the possible effect & will bring the Council’s concerns to HMT’s attention The Council will be responding to the PRA’s transposition of SII - seeking comments on the rules to transpose the amendments to the Directive introduced by Omnibus II The Council is meeting with the PRA

The Council submitted a response to EIOPA’s consultation on Implementing Technical Standards for SII in June – specifically

• n the procedures to be followed for the approval of a

matching adjustment

Donna Bathgate Chief Operating Officer

New Team

Faye Moutzouri Communications Manager Maggie Handscomb Administration and Services Manager

Events

• FSE on 24th & 25th Sep - stand and seminar on the

Changing Face of Retirement

• MBE on 8th Oct - stand and drop-in clinic for advisers with

4 of our members

• Guidance Guarantee Parliamentary Briefing on 21st Oct
• Finance Professional Show on 5th Nov - stand
• PFS National Conference 2014 in Birmingham on 6th Nov -

conference session

• ER Awards on 25th Nov
• GCM on 3rd Dec in York

Questions?

Standards Board Update

Jim Dredge 6 October 2014

Recent topics

• Revisions to Competition

Compliance Statement

• Reminder to members about the

requirement for face-to-face advice to be given to customers by solicitors

• Recent issues arising from

Standards Board meetings

Competition Compliance Statement

• The existing Statement makes a number of

references (to ERC programmes & co-

• rdinators) which are not accurate
• Firms need to be reminded of their obligations

under the Competition Act 1998

• Those responsible for chairing meetings will

remind members at the start of business

• A revised statement will be sent out to new

and renewing members, and to all working groups and Committees

Face-to-face legal advice I

• The Council’s Rules require that all customers

must have at least one face-to-face meeting with a qualified solicitor before committing themselves to their equity release plan. (“Solicitor” also includes a chartered legal executive or licensed conveyancer)

• The purpose of this meeting is to make sure

that customers fully understand their rights and obligations under the ER contract, and have an opportunity to ask questions

Face-to-face legal advice II

• The solicitor is required to verify:

– the customer’s identity and signature; – the customer’s mental capacity to enter into the contract; – that no duress/undue influence is being exercised; and – that where there are joint customers, each agrees to enter into the contract

Face-to-face legal advice III

• If the meeting is not with the solicitor who

actually provided the written advice to the customer prior to the meeting, it must be with another qualified solicitor who is acting in accordance with written instructions from the advising solicitor

• Responsibility for conducting the meeting

with the customer cannot be delegated to someone who is not a qualified solicitor

Standards Board - recent issues

• Guidance on Complaints Handling
• Review of cases decided by FOS
• Adoption of a single Annual Certificate of

Compliance

• Survey of members’ use of benefits

calculators

Guidance on Complaint Handling I

• The majority of complaints are from customers

about their ER advice or Plan

• Complaints may also arise if –

– A customer complains about a firm’s interpretation of the Council’s Rules & Guidance or – A member complains about another member’s interpretation of the R&G or the Council’s interpretation of the R&G

Guidance on complaint handling II

• We have issued guidance to members on

how the Council will deal with complaints which concern interpretation – either by a member firm or by us – of our Rules & Guidance

• The guidance can be found in the members’

part of the website, in the documents library

Complaints referred to FOS

• FOS does not publish data about ER

complaints separately from mainstream mortgages

• The exact number of ER-related

complaints referred and rejected between 01.04.13 and 01.09.14 is not known, but 14 cases were upheld. They related to plans taken out between 2006 and 2012

• We will continue to monitor the volume and

any trends which emerge

Certificate of Compliance

• We currently have 5 categories of

membership – and 5 versions of the Annual Certificate of Compliance

• Since all members are expected to comply

with the Rules & Guidance as they apply to them, we have introduced a single, simpler version for use by all members

• The new version draws members’ attention

to the need to comply with the current version of the Rules & Guidance as they appear on the website

Benefits Calculators

• The Standards Board has been looking at

the use members make of benefits calculators when advising customers on the impact of ER on benefits entitlements

• We have received presentations from

Turn2Us and Ferret on their products

• The Council has recently conducted a

survey of members’ practices

• Gareth Morgan of Ferret will be speaking

at a workshop this afternoon

Questions?