Onshore bond providers
Advisers are, on average, recommending 1.6 onshore bond providers.
Defaqto undertakes an annual satisfaction survey among financial advisers to establish the service levels of providers of wealth and protection products. This paper sets out the results for the investment bond market.
Overall scores
All satisfaction scores are significantly lower than those recorded last time by, on average, eight percentage points.
Top three positions
Transact, Aviva, Quilter and Nucleus achieved the most top three positions for performance across the seven categories of satisfaction.
Other investment products
Interest in other investment products has generally increased since the previous study, particularly for the conventional products including pensions and investment ISAs, which have the support of over 90% of advisers.
- The study was conducted between August and September 2023 employing an online survey. It measured the relative importance of seven satisfaction categories and identified the advisers’ preferred providers of investment bond business.
- The study measured how satisfied the advisers are with their preferred providers and identified where expectations were being met by cross-matching ranked importance with ranked satisfaction.
- Open architecture products remain the first choice over bonds with a limited fund selection, and onshore bonds are preferred to international bonds. While these preferences haven’t altered since the previous study, advisers are selecting fewer different bond types – on average, just 1.48 different types of bond.
- Interest in other investment products has generally increased since the previous study, particularly for the conventional products including pensions and investment ISAs, which have the support of over 90% of advisers. Fewer advisers are recommending bonds; after personal pensions and investment ISAs, only 35% of advisers said they would recommend onshore bonds next and only 19% said they would recommend international bonds.
- Prudential is dominant in the onshore bonds market with 46% of advisers saying they had recommended the firm in the last 12 months. In the international bonds market, Canada Life International (IoM) is the most recommended provider with the support of 16% of advisers. Advisers are, on average, recommending 1.6 onshore bond providers and 0.87 international providers
- Where advisers said they had recommended more than one provider, we asked them to rank the providers they use in order of preference. Prudential was the first or only choice for the greatest number of advisers writing onshore bonds and Canada Life International (IoM) was in most advisers’ top three choice for international bonds.
- The ranked order of importance is largely unchanged since 2022. New business administration remains the most important category to advisers with an average score of 4.57 out of 5, and Reporting remains the least important with an average score of 4.22 out of 5.
- All satisfaction scores are significantly lower than those recorded last time by, on average, eight percentage points. The administration categories that are ranked most important to advisers took the greatest hit. This feedback indicates a general dissatisfaction with bond provider service.
- Transact, Aviva, Quilter and Nucleus achieved the most top three positions for performance across the seven categories of satisfaction. It is notable that the firms that are recommended the most and those that are the preferred choice of advisers are not necessarily those that received the highest performance scores.
- A cross-match of ranked importance and ranked satisfaction demonstrates that the industry is exceeding expectations for four out of the seven categories of service. However, for the third year in a row, there is a poor correlation between importance and performance with expectations not being met for the important administration categories.
View the full report here