The latest edition of the consumer magazine Which? surveyed 30 financial advisers in the south of England and in Wales.
Ten were tied agents, 10 were banks or building societies and 10 were independent financial advisers. The magazine sent out two researchers with differing requirements to find out about the standard of advice.
Which? said the advice was biased by the amount of commission earned on the product sold. One of the researcher's needs would have been met by term insurance, in particular by pension-linked term insurance - the most tax-efficient type.
The researcher clearly stated that he wanted insurance only until his children were grown up. According to the magazine, General Accident, the independent financial adviser Chris Leach, Midland Bank Principality, Reliance Mutual Save & Prosper and Yorkshire Building Society offered whole-life contracts.
These contracts cover you until you die and often pay far larger commission than term insurance.
However, General Accident rejects the implication of the article. It pointed out that the researcher did not in fact receive a recommendation from one of its salesmen. It also said that its whole-life product did not, as implied by the article, pay the salesman more commission.
Peter Hales, assistant general manager, said: 'To suggest a company gives wholly inappropriate advice which is commission-driven is irresponsible and misleading, particularly when the consumer looks to the Consumers' Association to provide accurate and factual information to help the decision- making process'.
Which? said it was standing by the findings of its researchers. General Accident has written to the Consumers' Association with a view to trying to sort out the situation.Reuse content