TERMS OF BUSINESS & KEY FACTS ABOUT OUR SERVICES & COSTS As Independent Financial Advisers we operate within a regulated environment and are obliged to provide you with a range of documentation at the outset. Some of the documentation will prove to be very useful for you and of some interest. Other elements may be of limited interest or may not apply to you at all. Although it may appear daunting to start with, your adviser will explain all the relevant content to you, so that you can make the most of our advice. The first document is our “Terms of Business letter”. This explains our status as Independent Financial Advisers, and some of the basic rules and legislation under which we operate, such as how we must comply with Data Protection and Money Laundering regulations, as well as how we like to do business. The second document is “Key Facts – about our services and costs”. This explains the various types of advice and services we could offer. As truly independent advisers we offer the most wide-ranging options in all sectors, as we believe this is the only way to provide maximum benefit for our clients. This document also explains the various ways we could be paid. As truly independent advisers we offer our clients the option to pay for our work by fees, by commission, or by a combination of the two. We will always disclose any commission earned on any product that we do recommend before you proceed. If you pay by fees we will always agree the fees to be paid in writing prior to undertaking any work. Our normal way of working with our clients is designed to promote a long-term relationship based on mutual respect, understanding and trust. Our service programme revolves around six clear and distinct steps. The first of these is a Discovery Meeting. This is where we get to know each other and we fully explain to you the benefits to be attained from our service programme. This key element is at our cost and will always be without obligation or charge. By the end of this part of our initial meeting you should be comfortable with the thoroughness and professionalism of your adviser and have a genuine feeling that they have your best interests at heart. At its most comprehensive, our advisory process will usually provide you with a personalised written report and lifetime cash flow forecast. Our report will detail our advice and is issued before we implement for you, any financial product that we may recommend. It is our aim and hope that we will establish a long term mutually beneficial working relationship with you.
INDEPENDENT FINANCIAL SERVICES (PROFESSIONAL CONNECTIONS) LTD - TERMS OF BUSINESS From 1 December 2004 it is possible for firms to offer financial advice in the following ways; Covering the whole of the market; From a limited number of providers; or From a single provider. INDEPENDENT FINANCIAL SERVICES (PROFESSIONAL CONNECTIONS) LTD OFFER INDEPENDENT FINANCIAL ADVICE COVERING THE WHOLE OF THE MARKET
Authorisation for us, Protection for you - Independent Financial Services (Professional Connections) Ltd is associated with Independent Financial Services (UK) Ltd, and is an appointed representative of the Falcon Group Plc which is authorised and regulated by the Financial Services Authority (FSA). Falcon Group Plc maintains compliant Professional Indemnity insurance to ensure the protection of our clients. Deposits, life and general insurance firms, investment business (on or after 28 August 1988), home finance (e.g. mortgage) advice and arranging (on or after 31 October 2004), General insurance policies advice and arranging (on or after 14 January 2005) are all covered by the Financial Services Compensation Scheme (FSCS). Termination – You, or We, may terminate our authority to act on your behalf under these terms of business at any time, without penalty. Notice of this termination must be in writing and will take effect immediately upon receipt of the notice. Termination will not prejudice the completion of transactions already initiated on your behalf or any rights or obligations already outstanding. Remuneration – Fees or Commission – You will be provided with a key facts document, “key facts about our costs and services”. The content of the key facts document will be explained to you before any work is undertaken. Client Money and Documents – We do not handle client‟s money. We never accept a cheque made out to us (unless it is in settlement of fees for which we have sent you a bill) nor do we handle cash. We will account to you for transactions effected on your behalf either by means of a contract note, or by providing documents of title or certificates evidencing title. All investments will be registered in your name, unless you instruct us otherwise in writing. We will forward to you all documents showing ownership of your investments as soon as practicable after we receive them. Where a number of documents relating to a series of transactions are involved, we may hold each document until the series is complete and then forward them to you. Data Protection Act - We are required to demonstrate to the FSA that we “know our client”. Through this process we may request “sensitive data” from you. If you agree to provide this information, we will take this as your explicit consent to the processing of such information on computer and/or paper files. You agree that information which you give us may be disclosed to third parties for the purpose of processing your application or to another firm upon sale of all or part of our business. If you do not agree to this storage, use and disclosure, please write to the Data Protection Officer, Independent Financial Services (UK) Ltd, 404 The Waterfront, Stonehouse Park, Sperry Way, Stonehouse, Gloucestershire, GL10 3UT. Independent Financial Services (UK) Ltd and third party product providers may use and analyse your personal data, including the nature of your transactions to give you information by post, telephone, fax or e-mail about our/their products and services and those of selected third parties which may be appropriate. If you do not wish to be contacted in this way please write to the Data Protection Officer, as above. UK Money Laundering Regulations - We are obliged to conform with UK Money Laundering Regulations which require us to confirm the identity and place of residence of each investor. This may require sight of certain documentation, checking with a credit reference agency, the electoral roll or directory enquires in order to verify your details. A credit reference agency may record the search. We take no responsibility for any delay in investing where money laundering verification is needed. Cancellation of Policies - If we agree to be remunerated by commission that does not mean our service is free. We are still paid, indirectly, by you, through product charges. If you subsequently cease to pay the premiums on the policy, or do not start the policy as agreed, we reserve the right to charge you a fee, in line with our fee option. Full details of our fee option are provided in the Key Facts document which you will be provided with. Such a fee will only be charged during the „Initial Commission‟ earnings period (typically the first 48 months of the life of the product), this will be detailed in the illustrations provided to you. Where we have rebated commission for your benefit and the policy is subsequently cancelled, we reserve the right to charge a fee equivalent to any loss incurred by ourselves.
about our services and costs
Independent Financial Services (Professional Connections) Ltd Suite 29 Hilton Hall, Hilton Lane, Essington, West Midlands, WV11 2BQ 1. The Financial Services Authority (FSA) The FSA is the independent watchdog that regulates financial services. This document is designed by the FSA to be given to consumers considering buying certain financial products. You need to read this important document. It explains the service you are being offered and how you will pay for it.
2. Whose products do we offer? Investment
We offer products from the whole market. We only offer products from a limited number of companies. We only offer products from a single company.
Insurance
We offer products from a range of insurers for term assurance, critical illness insurance, income protection insurance, family income benefit insurance, accident, sickness & unemployment insurance, mortgage payment protection insurance and buildings & contents insurance. We only offer products from a limited number of insurers We only offer the products of a single insurer
Mortgages & Lifetime Mortgages
We offer mortgages & lifetime mortgages from the whole market. We only offer mortgages & equity release products from a limited number of lenders. We only offer mortgages & equity release products from a single lender. We do not offer home reversion plans.
3. Which service will we provide you with? Investment
We will advise and make a recommendation to you after we have assessed your needs.
You will not receive advice or a recommendation from us. We may ask some questions to narrow down the selection of products that we will provide details on. You will then need to make your own choice about how to proceed.
We will provide basic advice on a limited range of stakeholder products and in order to do this we will ask some questions about your income, savings and other circumstances but we will not:
Conduct a full assessment of your needs;
Offer advice on whether a non-stakeholder product may be more suitable
Insurance
We will advise and make a recommendation for you after we have assessed your needs for term assurance, critical illness insurance, income protection (health) insurance, family income benefit insurance, accident, sickness & unemployment insurance, mortgage payment protection insurance and buildings & contents insurance. You will not receive advice or a recommendation from us. We may ask some questions to narrow down the selection of products that we will provide details on. You will then need to make your own choice about how to proceed.
Mortgages & Lifetime Mortgages
We will advise and make a recommendation for you after we have assessed your needs.
You will not receive advice or a recommendation from us. We may ask some questions to narrow down the selection of mortgages & equity release products that we will provide details on. You will then need to make your own choice about how to proceed.
4. What will you have to pay us for our services? Investment Not all firms charge for advice in the same way. We will discuss your payment options with you and answer any questions you have. We will not charge you anything until you have agreed how we are to be paid. We have ticked the payment options we offer.
Paying by fee. Whether you buy a product or not, on completion of our work, you will pay us a fee for our advice and services. If we also receive commission from the product provider when you buy a product, we will pass on the full value of that commission to you in one or more ways. For example, we could reduce our fee; or reduce your product charges; or increase your investment amount; or refund the commission to you. We will confirm the rate we will charge in writing before beginning work and we will tell you if you have to pay VAT. You may ask us for an estimate of how much in total we might charge. You may also ask us not to exceed a given amount without checking with you first. Our typical approach is to agree with you a fixed fee for all projects and work undertaken that is based upon the expected value of the work we are carrying out. The primary reasons for this are: If we charge based upon time (by the hour), all the risk is yours – if the work takes a long time, you will pick up the tab.
We have the experience to price the work that we do fairly and correctly.
It is not fair on either party for work to be taken on, without knowing what the price would be.
We look to focus on the results and the value of our service, not on time and effort, which could achieve very little.
By not charging by the hour, we are constantly looking to demonstrate our expertise through spotting ways to save tax, improve cost savings, enhance potential investment returns, deliver high levels of service, save time & provide peace of mind.
Detailed information is contained in “Your Future Direction” guide and is also at www.ifsproconnect.co.uk , with some examples below: Discovery Meeting: Whilst we get to know each other and we fully explain to you the benefits to be attained from our service programme, all time spent is at our cost. Gathering Data: Limited Advice requested:
£100
Full Advice requested:
£250
Evaluation & Gap Analysis: Simple:
£100
Moderate:
£250
Complex – inclusive of a lifetime cash flow forecast:
£500
The cost parameters of the other elements of “Your Future Direction” programme can vary significantly from client to client. We are unable to set a fee until we get to these stages. Rest assured, any fee will be quoted once the extent of the work is known and will be presented to you before we commence any work on your behalf. On the rare occasion where an hourly rate is deemed appropriate, examples fees are: Director / Partner / Financial Adviser: Administration:
£125 - £200 per hour £25 - £50 per hour
Paying by commission (through product charges). If you buy a financial product, we will normally receive commission on the sale from the product provider. Although you pay nothing up front, that does not mean our service is free. You still pay us indirectly through product charges. Product charges pay for the product provider‟s own costs and any commission. These charges reduce the amount left for investment. If you buy direct, the product charges could be the same, higher, or lower, as when buying through an adviser. We will tell you how much the commission will be before you complete an investment, but you may ask for this information earlier. The amount of commission we receive will vary depending on the amount you invest and (sometimes) how long you invest for, or your age. For example: If you invest £30,000 in an Investment Bond we could receive commission of 4% of the amount invested (£1,200) and 0.5% of the value of the fund (approx. £150) every year. If you invest £7,200 into an Individual Savings Account (ISA) we could receive commission of 3% of the amount invested (£216) and 0.5% of the value of the fund (approx. £36) every year. If you pay £100.00 per month into a personal pension (with a term of 25 years) then we could receive commission of £521.
When we have arranged any investments for you we will be glad to advise you at any time should you ask us to do so but we will not give you any further advice unless you request it. Where we do agree an ongoing service with you, a separate written agreement will be provided. Paying by a combination of fee and commission (through product charges). In some circumstances, we may charge you a combination of fee and commission. The fee will not exceed the rates shown in this document. We will agree the rate we will charge before beginning work and we will tell you if you have to pay VAT. The fee will become payable on completion of our work. You may ask us for an estimate of how much in total we might charge. You may also ask us not to exceed a given amount without checking with you first. We will tell you how much the commission will be before you complete an investment, but you may ask for this information earlier. Where we charge a combination of fees and commission, our maximum rates are set out in the fee information and the commission sections above. In addition to the above we may charge a fee on a different basis for a specific transaction or project but we will agree this with you in advance.
Insurance
A fee for term assurance, critical illness insurance, income protection (health) insurance, family income benefit insurance, accident, sickness & unemployment insurance, mortgage payment protection insurance and buildings & contents insurance. The fee will be in line with the fee structure in; “Paying by fee”, above.
No fee, we will be paid commission from the provider for term assurance, critical illness insurance, income protection (health) insurance, family income benefit insurance, accident, sickness & unemployment insurance, mortgage payment protection insurance and buildings & contents insurance.
You will receive a quotation which will tell you about any other fees relating to any particular insurance policy.
Mortgages & Lifetime Mortgages
No fee - We will be paid a procuration fee from the lender or provider. Fee only - Where we agree to payment by means of a fee the amount will be disclosed and agreed with you before an application is completed. Typically the fee will be in the region of £450-750 depending on the type and size of mortgage and will usually be due at the time the application is completed. If you choose this option we will refund to you any procuration fee we are paid by the lender or provider. A fee may be payable in addition to any procuration fee we may receive from the lender or provider. Where we agree to part payment by means of a fee the amount will be disclosed and agreed with you before an application is completed. Typically this will be charged to reflect the work undertaken in advising and arranging the mortgage, or lifetime mortgage, where the fee paid by the lender is not sufficient to cover the cost of our service. The fee will usually be due at the time the application is completed.
You will receive a key facts illustration when considering a particular mortgage or lifetime mortgage which will tell you about any fees relating to it. Refund of Fees If we charge you a fee, and your mortgage or lifetime mortgage does not go ahead, you will receive:
A full refund - if a fee has been paid up front and you decide not to proceed, or are unable to proceed, before any work has been undertaken on your behalf.
A refund subject to a minimum fee of £250 if we are unable to secure a mortgage for you or if you decide not to proceed before an offer of mortgage is made.
No refund. Once you have received an offer and you then decide not to proceed. If you are unable to proceed with the mortgage for reasons beyond your control we may agree a refund (subject to a minimum fee of £250) at our discretion.
Message from the Financial Services Authority - Think carefully about this information before deciding whether you want to go ahead. If you are unsure about which equity release product is right for you, you should ask your adviser to make a recommendation.