AMP will implement a new fee and service model for its aligned advice network that will put an end to its buyer-of-last-resort (BOLR) arrangements and also allow the transfer of clients out of the AMP network.
The financial services company said a new “competitively benchmarked” fee model and service proposition would be phased in over one year from 1 January 2022 and it would contain core and user-pays services.
Further changes would include the release of institutional ownership of clients from AMP Financial Planning to advisers within the aligned advice network from 1 January 2022.
This move would allow clients to be transferred out of the network, with AMP adding it would end its client register buyback arrangements from 31 December 2021, and practice principals would still be able to take advantage of current terms remaining in place until this date.
It stated it expected more advice practices would leave the company before the end of the buyback arrangements and expects its commitments will be covered by the existing provisions and capital allowances as part of its BOLR program.
AMP advice managing director Matt Lawler said the changes represented a new value proposition for its financial advisers that was based around the company being a professional services provider to financial advice practices and was another stage in the transformation of its advice business.
“Over the past few years we have worked with our financial adviser network to complete significant reforms, build robust and modern processes and are strengthening our compliance regime,” Lawler said.
“We will be providing access to resources, technology and support to fulfil our two core promises to our financial advisers: to assist them to deliver a great client experience and to support them manage and grow their business.
“Importantly these changes recognise that the financial advisers should be in control of their business. It is their business, it is their clients and with our support we are determined to be working with our financial advisers long into the future.”
AMP stated the new fee and service model was developed in collaboration with AMP adviser associations, with The Advisers Association (TAA) chair Craig Armstrong saying: “This model creates a more sustainable business model for our members staying with AMP and supports the shift to the professionalisation of the advice industry.
“TAA is pleased with the collaborative way that the new AMP Australia management team engaged in this process.”