The cost to independent financial advisers of acquiring new high net worth clients has risen sharply from £3,850 ($6,825) a head in 2002 to ...

The cost to independent financial advisers of acquiring new high net worth clients has risen sharply from £3,850 ($6,825) a head in 2002 to £5,271 in 2004, according to new research from Winterthur Life, a life insurance company. “This is leading many financial advisers to look at the different methods they deploy to acquire new business and evaluate each approach to its effectiveness,” said David Thompson, sales director at Winterthur Life, in an interview in the UK media. He pointed out that whilst the majority of recent research into the high net worth market has been on financial advisers improving the service they offer wealthy clients, there has been little emphasis on the actual costs of acquiring business. The research further reveals that the internet is proving a big winner for many financial advisers as a method of generating quality leads. As a source of generating leads, e-marketing has grown from 9.7 per cent in 2002 to 24.3 per cent in 2004 — a larger increase than any other method, including client referrals (70 per cent to 76 per cent), advertising (18 per cent to 15 per cent) and introductions via professional intermediaries (31 per cent to 30 per cent). “Winterthur Life has conducted extensive research over recent months in an attempt to fully understand how these new wealthy clients formulate their opinions and desires around the provision of financial advice,” said Mr Thompson. The change in the pension rules in April of next year, allowing investors to hold residential property in their self-invested personal pension, is expected to generate a large amount of new business, particularly from the HNW market.