Boston - Wrap platforms are changing the way UK insurance firms are able to distribute their products and will raise a number of challenges for IT departments, according to a new report issued by Boston-based research firm Celent LLC.
As a Web-based portfolio administration service, wrap platforms will be key in the evolution of the distribution of financial services and products, notes the report's author, senior analyst Catherine Stagg-Macey.
"Wealth management has already been transformed by these platforms in the US and Australia, and it is now the UK's time to catch up. The impact of depolarization, regulation of independent financial advisors (IFAs), and changing consumer attitudes are all factors that ensure this is a solution chasing a problem," she says.
The report, "Wrap Platforms in the United Kingdom: An Insurer Perspective," provides an overview on wrap platforms and the insurance perspective. Conditions are in place for the wrap market to continue to develop with more wrap providers entering, and current providers extending and broadening their offerings.
"A wrap platform is not a product in itself," says Stagg-Macey, "but rather an enabling technology. Wrap platforms are about a financial relationship between end customers, their IFA, and the product manufacturer."
Stagg-Macey notes that there are there are benefits for all parties involved in the wrap platform. "The customer gets a consolidated view of the portfolio, with access to a wide range of funds, often at wholesale prices," she says. "The IFA benefits from the considerable efficiency to be had by viewing client portfolios in a single place. The product manufacturer benefits from lower costs in distribution." Source: Celent
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