Access to great technology is no longer the differentiator it once was.
Financial advisors who had this access and were early adopters once held a competitive advantage over their peers. Today, however, the democratization of innovative technology is starting to level the playing field. A major driver of this evolution has been a seismic shift away from a focus that had traditionally been on asset management to more holistic financial planning.
Advisors once feared that the advent of robo-advisors could cause massive disintermediation, but advisors have quickly learned how to take advantage of this technology to create more efficiencies within their practice(s). This has also enabled financial advisors to plan more confidently and create better potential outcomes for their clients. Now that access to this technology is no longer a differentiator, the bigger risk lies in not fully adopting and properly utilizing what is available at an advisor’s fingertips.
It goes without saying that 2020 has reinforced the significant role of technology in cultivating and enhancing the client relationship, particularly for independent RIAs. In 2021, 81% of firms expect to increase their tech budget by more than 5% from 2020, according to F2 Strategy Research. Independent RIAs spend more money per capita on technology than the wirehouses and banks, but often struggle to deploy and implement it, which means many firms are spending a lot of money on technology and not getting much benefit from the investment. They are not using the technology in a manner that results in many benefits for their clients.
Tech savvy carriers can help RIAs so that they can better utilize the latest technology in a much more effective way.
Insurance carriers and other product and service providers are an important partner for advisors as they navigate the ever-growing market for fintech and insurtech solutions.
So what should advisors look for from their insurance carriers and other providers?
Here are four ideas.