The answer to the question of whether stockmarket declines present clients with an opportunity to invest is going to differ depending on the client and their financial situation.
As with all crashes, the recent falls typically prompt one of two conversations, according to Scott Gallacher, chartered financial planner at Rowley Turton Private Wealth Management.
“Firstly, from more conservative clients concerned about the impact of those falls and, secondly, from those clients looking to invest more to ‘take advantage’ of the falls,” he explains.
“One key difference with this situation is perhaps the government’s sensible option of furloughing staff which will lead to some changes in people’s actions.”
Mr Gallacher recalls that in previous market crashes, advisers’ clients might have been laid off and had to effectively take early retirement.
“Whereas now, with furloughing an option, I suspect that the opposite will happen, that is, people that would have naturally retired will be happy to be retained on 80-100 per cent of their salary.
"This could have a negative impact on advisers by reducing new business enquiries,” he cautions.
Taking cover
Mr Rooney observes that more recently, he has been “inundated” with enquiries about life insurance, even from clients who were previously not interested in buying protection before.
Mr Varsani points out that the questions he has received from existing clients have been focused around policy wording and reassurance that, in the event of death or long-term sickness, their existing life cover and income protection policies will pay out on a claim.
“From prospective clients there have been two main types of enquiry,” he continues. “The first from those who have been meaning to review and arrange cover for a while but have kept putting it off.
“The reality of Covid-19 has hit home that we truly never know what is around the corner. Sadly, some have been affected via the loss of a family member or friend.”
He says: “The second type of enquiry has been from those interested in taking cover ‘until the Covid-19 pandemic is over’. These are dealt with via a more considered and careful approach. As an advisory business we need to ensure policies are taken for the right reason.
“For those clients who see the wisdom of long-term protection, we proceed towards the advice process.”
