Technology set to revolutionise CIPs
Does your Centralised Investment Proposition (CIP) need some TLC?
CIPs have become the norm in the financial advisory space over the past ten years, with approx. 82% of firms using a CIP to service their clients’ portfolios1. While CIPs can produce good investment outcomes for clients in bulk, there’s a probability that your firm is overspending valuable adviser hours, simply on managing the process.
There’s also a chance you’re spending more money on the strategy than you originally bargained for – a typical CIP now costs the owner 1.7% to 2.3% of their client fee2. Not to mention traditional CIPs can negatively impact your client’s investment goals, purely due to the operational friction of different outsourced teams working in silos, rather than as a singular, informed, powerful unit.
Let’s dig around that for a moment. Despite what the name suggests, a CIP isn’t always that central. Rather than a single entity, it’s actually made up of different tools, services, and providers to deliver the value for money that your clients expect.
Most CIPs will contain:
• Back-office system: to administrate your client data
• Research tools: to scout for investment opportunities
• Planning tools: to engage with clients, develop their financial plan, and analyse their future goals
• Investment managers: to maintain ongoing communication with clients
• Platforms: to obtain approvals
• Client portal: to maintain regular client engagement
How well do these operational segments really work together? Our experience in the market suggests they are ‘orbiting satellites rather than effective integration’3.
This can cause advisers to lose visibility of their client journey, resulting in client fees becoming confusing and opaque. For many firms, this is impacting the level of service they can provide – and they are looking for a modern equivalent to a CIP, with 74% of advice professionals planning to seek deeper integration with their back-office system, platforms and research tools4.
When you look deeper into the research, carried out by the lang cat in 2020, it’s clear to see why. 82% of firms describe obtaining client authorisations as ‘a major issue’ with running their CIP5. A lack of technology integration, and a reliance on paperwork, can make these approvals eat up too much of advisers’ time. Further, 83% of advice professionals named MiFID II costs and charges disclosure as a ‘serious issue’, with these regulatory requirements hugely increasing the time needed to run a firm’s CIP6.
When you break it down into a client’s value for money, they are paying advisers to deliver strategies that deliver their investment goals: not to spend long, drawn-out hours on administration, approvals, and paperwork.
So, what does better look like?
At intelliflo, we’ve created a solution to address common pain points that can disrupt the financial advisory journey when using a CIP. Our integrated model portfolio service (IMPS) can help you take back control and deliver great value by insourcing the whole client advice journey.
IMPS quite simply removes the administration friction that comes from advised investment portfolio management, whilst helping to:
Drive client engagement
With IMPS, there’s no confusion over who is in control of your client’s advice journey – you are. A fully white labelled solution, with expert market commentary included, you will be in a strong position to increase client engagement and touch points, without the need to increase meeting and administrative phone calls.
Simplify your client fees
With IMPS you have quick and easy access to leading model portfolio providers such as Invesco MPS and Sparrows Capital’s SCore MPS. This allows you to assume control of your client’s advice process and simplify client fees because you are the central point of contact.
Rebalance as regularly as you need
Obtaining client approval can slow down portfolio rebalancing and limit opportunities. Connecting you with your clients through the intelliflo personal finance portal will help to speed up this process with automatic client affirmation messages. This will allow you to communicate rebalances and model updates quickly, efficiently and as regularly as you need.
Access a full audit trail via intelliflo office
All of the information, correspondence and advice is stored against the client record in intelliflo office, meaning that you have a complete audit trail and up-to-date information. Better yet, the personal finance portal will enable you to show your clients this data in real-time, giving them a clear demonstration of your value with complete administrative oversight of the entire process.
IMPS is powered by intelliflo, but it’s controlled by you and that’s how your clients will see it. In fact, IMPS is the only offering in the market delivering a fully adviser-branded experience with these efficiencies for clients. Want to find out more? To learn how IMPS can help streamline your business and save you time, please feel free to contact us at firstname.lastname@example.org
1 the lang cat – ‘How do we rebuild Centralised Investment Propositions from here?’ market insight report (July 2020)
3 intelliflo - The Future of Centralised Investment Propositions (July 2020)
5 intelliflo – The Problems of Centralised Investment Propositions (July 2020)