The change occurred at the beginning of the year with Zurich explaining the re-structuring was a result of it moving away from a product-focussed approach to a more commercial, mainstream positioning in the market.
Under the new remuneration scheme, Zurich will pay advisers on a tiered basis, where payments also depend on how much an adviser sells in a certain category, for example life, pensions and investments and mortgages. Each category has fixed rates, worked out on a rolling 12-month basis.
Zurich said it does not deduct any money for itself but other parties, such as lenders, might do so.
The move is in line with Zurich’s strategy of encouraging its ARs to cross-sell as many product categories as possible. As part of this, the network will be launching ‘Open Work’, where it will move from a tied sales force to a multi-tied distribution network from 1 June.
Paul Shearman, Zurich’s mortgage management director, said: “Open Work will go live to 2,000 of our advisers, of whom around 80 per cent do mortgages.
Advisers will have access to providers that cover the whole of market. It is crucial to our overall success, and any network’s success, to drive our ARs to cross-sell across all areas.
We are getting our pensions guys to talk about mortgages, our mortgages guys to talk about investments and so on. This is part of the proposition.”
Open Work will be a separate legal entity to Zurich Advice Network. Although it will partially own it, the majority stake will be owned by the advisers – Open Work is planning to float on the stock market within three to five years.
Mike Fitzgerald, sales director at Brentchase Financial Services, said: “Advisers do need to cross-sell now, even more than before, as long as this causes no detriment to the client and they are given the best advice.”
