How to write a report recommending a purchased life annuity

Nigel Ogram

As I’m sure you all know, annuity rates are at a historically high level. Consequently, pension annuities are being recommended more than they have been for many years.

Source: sharingpensions.co.uk

Also benefiting from high annuity rates are Purchased Life Annuities (PLA). This month’s user tip blog covers how to write a suitability report recommending a PLA in Genovo.

As with all Genovo ‘how to’ blogs, I’m not going to explore absolutely everything that needs to be considered when recommending a PLA, but instead I’m focusing on the task of documenting the advice in a compliant suitability report that’s quick to create and easy to read.

The process

1. Select or add the client

From the Genovo main dashboard, go to Write report and select or create the private client(s) you wish to write the report to. If your Genovo account is integrated with your back office system, remember that you can import the client, rather than adding them manually, by clicking the add from CRM button.

2. Select the Report Creation Method

In the interests of completeness, this blog walks you through the steps of building the report using Genovo’s ‘from scratch’ report creation method. There are three other report creation methods available, designed to fast-track you through one or more of the steps below and make the report building process even easier.

3. Create the report

In Report Details, give the report a name and select the Report Type – we’d suggest using the Suitability Report.

4. Add the required sections

Assuming you’re using the ‘from scratch’ creation method, you’ll need to add the necessary sections from the ‘Available sections’ drop down, which in this instance will only be the New Investment Recommendation section.

The Recommended Investment Strategy section is not required, as there is no investment element to a PLA.

5. Complete all section wizards

Next, you’ll need to step through the section wizards of all sections that require your input, as follows:

5.1. The Introduction section

Progress through the steps of the Introduction section in the usual way. When you reach the Client Objectives step you should select or add the advice option(s) that accurately reflect the client’s objective(s) and add comprehensive Know Your Client (KYC) information to ensure you fulfil the regulator’s expectations of you in terms of documenting a client’s objectives.

If the PLA is being recommended for generating a secure long-term income, the following Genovo advice option may be suitable:

‘Start drawing an additional income of £*INSERT* from your investments to meet the current shortfall in your disposable income.’

If there isn’t a standard advice option that meets your requirements, you can add your own advice option if you prefer, or you can manually enter the client’s objectives by typing, pasting in external content, or even just speaking the objectives, by clicking the Add objectives as freetext button.

If you are integrated with intelliflo office, you can also import client objectives from IO by clicking the add data from CRM button:

Once you’ve selected or created your client objectives, you can click on the Edit Objective / Add KYC info link to tweak the objective wording to suit the client’s actual objectives and to add the KYC info – the ‘back story’ behind the clients’ requirement to generate a guaranteed income from their investments.

5.2. The Client Risk Profile section

It’s in this section that you will confirm the clients’ attitude to risk and capacity for loss, as well as their knowledge and experience and any investment preferences.

5.3. The New Investment Recommendation section

Simply follow the Wizard section steps in sequence:

5.3.1. Plan Summary

The recommended PLA can be added manually by clicking the Add plan button, or if your Genovo account is integrated with your back office app (and you’re working with an integrated client), click the Add plans from CRM button and choose which plans you want to import.

5.3.2. Why Product Type

There are six PLA-specific advice options that you can select from (or of course, you can add your own):

5.3.3. Why Provider / Plan

Again, there’s a PLA-specific advice option for you to select (or you can add your own):

5.3.4. Key Disadvantages and Tax Implications

Are you spotting a trend here? There’s a PLA-specific advice option that deals with the taxation treatment that’s unique to PLAs (much of the income is treated as a return of capital and is therefore not taxable).

5.3.5. Other Solutions

This an optional step to record any other solutions that were considered, but discounted. If you don’t select any options, the ‘Alternative Solutions’ subsection won’t be included in your report.

5.4. The Important Information section

This is the last wizard section you’ll need to complete and the steps are self-explanatory.

6. Tailor the structure of the report

Having completed all the section wizards you should then tailor the structure of your report by unchecking any sections you do not wish to include in your report; and then change the sort order of any sections to reflect your personal preferences.

You’ll find more information about how to remove sections from your report here.

You’ll find more information about how to reorder the sections in your report here.

7. Create and edit the report

Having created the framework of the report with 98%+ of the content already included as an initial draft in the Report Builder, both Writer and Reader users can then make any final tweaks to the content of the draft report in the Report Editor. To open and edit the report in the Report Editor click Create / Edit report.

On opening the report you’ll notice the report follows the typical Genovo format and structure. However, there will be a small table in the New Investment Recommendation section of the report that covers the options and benefits of the PLA that will require a bit more input and editing from you in the draft report. It is here that you may include details of any dependant’s pension or escalation rate etc.

8. Upload the completed report into your back office system

If your Genovo account is integrated with your back office system and you’ve been working with an integrated client, and you’ve been using the Genovo Report Editor to make the final tweaks to your report, don’t forget that you can upload the report back to the client record in the back office app with just a couple of clicks.

Nigel’s knowledge

So, what else can you do to make drawdown switching reports easier to complete?

The Gena report creation method is a great way to get all of the major elements of the report selected for you, all extracted from the prompt you enter at the start of the process. Give it a try!
An integration with a back-office app makes adding clients and plans much easier. This area of the Genovo Knowledge Base covers our current integration partners.
If the advice scenario of the report you’ve just worked on is likely to be repeated, you may then wish to convert it into a template and save it to your Report Template Library to use as a starting point for creating future reports.
If you created any custom advice options or advice reasons, you could keep them for re-use in future reports. You can do this ‘on the fly’ as you’re working in the relevant step, or you can do it from the Advice Option & Reason Library.
If you want to customise any of the boilerplate report content to reflect your own preferences, you can do this via the Report Content Manager:
What is the Report Content Manager?
Video tutorial – How to customise the boilerplate content of your reports and templates using the Report Content Manager
Genovo’s Report Editor includes all the common text-editing capabilities you’ll need, but adds adviser / paraplanner collaboration tools, version control, report ratings and back office document upload features too. Want to know more? Simply watch the video tutorial.