Insurer blames regulations banning commission payments for move affecting staff based in UK bank branches
Insurer Axa is cutting 450 jobs in branches of the Co-operative, Yorkshire and Clydesdale banks under plans to cease face-to-face financial advice.
The group blamed the decision on new regulations that banned commission payments, forcing customers to pay up front.
Axa has started consulting affected staff, who are based in bank branches across the UK but employed by the insurance giant.
Other firms including HSBC have also cut back on financial advice or restricted it to wealthy customers.
The chief executive of Axa, Paul Evans, said: “We are very disappointed that Axa UK must also now withdraw this service having not found a model which balanced the regulatory requirement that the service be profitable in its own right, whilst setting advice fees at an affordable level.”
The insurer has sold life insurance and savings products through bank branches for the past nine years. Customers will now have to rely on call centres.
A government shakeup of the financial advice sector last October banned free advice in a bid to stop firms selling unsuitable products.
Instead, financial advisers must clearly explain to the customer up front how much advice will cost and agree how the customer will pay for it.
A spokeswoman for Yorkshire and Clydesdale banks said: “This decision does not impact on any of the advice our customers have received nor on any policies they hold. We will continue to focus our support for Clydesdale and Yorkshire bank customers across our core retail and business banking strengths.”
A Co-operative spokeswoman said: “The financial planning service has been provided by Axa for a number of years and following their decision to withdraw from this market we will now be considering alternative options.”