12 July 2002 - Zurich Financial Services welcomes the Sandler Report and its commitment to simplifying products, increasing competition and improving the cost effectiveness of the industry.
Ray Greenshields, Chief Executive of Zurich's life business in the UK, Ireland and International, said:
"Sandler's report tackles issues of huge importance and we are delighted we now have an opportunity to debate the shape of future long-term savings. Many of these issues: - industry effectiveness, empowering consumers, simplifying products and deregulation - have been ignored or just given lip service in the past. This report will be a catalyst for change and together with the Pickering report, signals a recognition that regulation has become a heavy burden on both the industry and consumers."
Zurich's specific views on the Sandler report include:
Deregulation
Zurich has long campaigned for lighter regulation to improve access to savings information and products for consumers, and to keep distribution costs down. The company also supports Sandler's aim of improving industry competitiveness and believes that, in a long-term, stable environment, this will deliver greater value to consumers.
Advice
In particular, Zurich supports Sandler's comments on the key role advisers play in generating long term savings. Zurich firmly believes that face-to-face advice remains crucial to increasing financial provision in the UK. Sandler's agreement with the FSA proposal to de-polarise the advice industry as a key initiative to rekindle competition is welcome.
With-Profits
Zurich also welcomes Sandler's recommendations on improving transparency and unitised with-profits. Eagle Star's unitised with-profits fund has followed the 100/0 approach to with-profits recommended by Sandler, since 1995. The changes will create a more level playing field and increase competition in the industry.
"Growing consumer empowerment together with the need for retirement provision means that building initiatives around the customer will be critical to the future success of our industry," Ray Greenshields said. "Implementation of the recommendations needs to be carefully planned and consultation will be key. Working together we must ensure there is a strong foundation to support a healthy and profitable industry, consumer confidence and strong growth in long term savings."
