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Questions to ask an authorised financial adviser, and what they must tell you

By SortMyCover editorial team. Last reviewed . Fact-checked by SortMyCover editorial team on . See our editorial policy.

A man on a phone call at home
Short answer

Under the FAIS General Code of Conduct an authorised adviser must give a client the firm's details, its authorisation, how conflicts are handled and, where advice leads to a product, a written record of advice. Anyone can look an adviser up on the FSCA register, and can ask how the adviser is paid. This is information, not advice.

Some questions are easier asked out loud. How does this cover work? What happens if an income stops? How is the adviser paid? A form cannot answer those. A conversation can.

A first call with an adviser goes more smoothly when both sides know what to expect. South African law already sets out much of what an authorised adviser has to tell a client. This page explains those rules in plain words and lists questions anyone can ask. It is information, not advice: SortMyCover is not a financial services provider.

Step one: look the adviser up

Anyone can search the FSCA's public register of authorised financial services providers. The register shows whether a firm holds an authorisation, and for which kinds of products. It also lists the individual representatives who work under a firm.

To search, ask the adviser for their full name, their firm's name and the firm's FSP number. How to check an adviser walks through the register step by step.

Being on the register shows that a firm is authorised. It does not rate the adviser or say whether a particular piece of advice suits a household.

What an adviser must tell you

The FAIS General Code of Conduct is the rulebook for authorised advisers. It sets out information that an adviser must give a client at the earliest reasonable opportunity:

  • the firm's full name and contact details, and the names of contact people;
  • its legal status, and which business takes responsibility for the adviser's actions;
  • contact details for the firm's compliance department;
  • which financial services the firm is authorised to provide, and any conditions on that;
  • whether the firm holds professional indemnity or fidelity insurance;
  • whether the adviser is working under supervision.

If the adviser gives this information out loud, the Code says it must be confirmed in writing within 30 days.

The Code also deals with conflicts of interest. An adviser must avoid a conflict where possible, or reduce it where not. They must tell the client about any conflict and about the firm's policy for managing conflicts.

How advice is built

Under the Code, advice follows a set order. Before giving advice, an adviser must:

  1. ask about the client's needs and goals, financial situation, attitude to risk, and what the client already knows about the products;
  2. analyse that information;
  3. identify the products that fit.

A client can choose not to answer a question. If they do, the adviser must point out that the advice may be limited as a result. The same applies if a client picks a product other than the one the adviser recommended.

The record of advice

When a client takes up a product because of advice, the adviser must keep a record of advice. It sets out:

  • a short summary of the information the advice was based on;
  • the products that were considered;
  • the product recommended, and why it was expected to meet the client's needs.

The client must get a copy in writing.

Before and after signing

The FSCA's consumer booklet on life insurance says a consumer can take a policy away to read it, and can ask for it to be explained in plain language. A consumer can also ask the adviser for proof of qualifications and for full details of fees and commission.

Two more facts are useful:

  • Insurers ask health questions before offering cover. ASISA notes that a condition that is not disclosed can lead to a claim being rejected.
  • Under the Policyholder Protection Rules, a new long-term policy can be cancelled within 31 days of receiving the policy summary, if no claim has been made and no insured event has happened.

Questions to ask on a first call

These are examples. Anyone can leave out a question or add their own.

About the adviser

  • What is your FSP number, and are you a representative of a firm?
  • Which kinds of products are you authorised to advise on?
  • How are you paid, and does that change if I choose a product?
  • Which insurers' products can you advise on?

About the cover

About next steps

  • What information will you need from me, and why?
  • Will I get a record of advice in writing?
  • Can I take time before I decide anything?
  • What happens to my details after the call?

What to bring to your call lists the documents that make the first call go faster.

What happens on the 30-minute call

SortMyCover books the call and introduces one authorised adviser. SortMyCover is not on the call and does not give advice.

  • The call is booked for a time you pick and lasts about 30 minutes.
  • It can be a video call, a WhatsApp call or a phone call.
  • At the start, the adviser gives their name, their firm, its FSP number and how they are paid.
  • The adviser asks about the household and explains how the different kinds of cover work.
  • Booking the call is not an application for any product. What happens after the call is between you and the adviser.
  • Advisers pay SortMyCover a fee for the service. The fee does not depend on whether you buy anything.

What happens on a 30-minute call has more detail. To book, use the booking page or message SortMyCover on WhatsApp at +27 60 015 6480. Please do not send ID numbers, bank details or health details in a message.

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