PARADIGM MARKET UPDATE & OUTLOOK FOR 2018

Powering the UK’sleading financial advisers

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Contents

1. Executive Summary ............................................. 3

2. Background & Economics .................................... 4

Regulation in the Buy to Let Market ........................... 7

3. Market Regulation ............................................... 7

Senior Managers & Certification Regime ..................... 8General Data Protection Regulation ........................... 9MiFID ll and ESMA ................................................... 10

4. Paradigm’s Business ........................................... 11

Paradigm Mortgage Services ..................................... 12The Intermediary Mortgage Market ........................... 13The Older Borrower Market: Later Life Lending and Equity Release ........................................................... 14Paradigm Protect ...................................................... 16General Insurance ..................................................... 18

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1. Executive Summary

In September 2017, Paradigm Mortgage Services LLP celebrated ten years of trading. A decade since launch in the challenging market conditions of 2007, Paradigm is now firmly established as one of the UK’s leading Mortgage Distributor businesses. We have a dedicated, experienced and highly motivated team who are close to our members, and our aim remains as it’s always been; to deliver a first class, profitable and valuable service to all.

A great deal has happened in the financial services market over the decade from a market, financial and regulatory perspective, with much change amongst Lenders and Providers, some of whom have disappeared from the intermediary space or, indeed, completely, and more recently we have seen the entry of new players challenging the status quo. Paradigm has been a constant throughout and, very gratefully with your support, we have grown from strength to strength.

In July, we announced that Tatton Asset Management plc (TAM) had successfully floated on the Alternative Investment Market (‘AIM’) of the London Stock Exchange. TAM is the newly created parent company for three operating subsidiaries: Tatton Capital Limited, Paradigm Partners Limited and Paradigm Mortgage Services LLP.

This was an extremely exciting step in our growth journey to becoming the UK’s leading provider of discretionary fund management, regulatory and compliance services and mortgage services to the directly authorised (DA) marketplace. We simultaneously rebranded Paradigm Mortgage Services and Paradigm Protect in keeping with all TAM companies, creating a stronger brand identity going forward. We also launched two enhanced websites, for both Mortgages and Protection, which were well received by member firms attracting our highest ever hit-rates.

Tatton Asset Management was founded by CEO Paul Hogarth, Lothar Mentel, Co-founder of Tatton Capital limited and Bob Hunt, CEO Paradigm Mortgage Services and Paradigm Protect.

The vision in starting TAM was to create a group entity with a range of services to “power the UK’s leading financial advisers”, facilitating expansion and enabling them to better service their clients, and the flotation of our business is certainlynot the end of our journey, more a milestone in a business that remains committed to our members’ best interests.

Thank you for all of your support over the years and here’s to a prosperous 2018,

Robert Hunt CEO Paradigm Mortgage Services LLP

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There is no doubt that the snap general election triggered a level of uncertainty that remains in the market today. Whilst housing is very much a domestic issue, the ongoing Brexit uncertainties, political commentary and wider global events do appear to be influencing consumer confidence, albeit that a clear difference is noted in London and the South East compared to other parts of the UK.

Whilst housing market activity has built up modestly throughout the year, the same negative-supply side issues apply, where, put simply, we just need to build more houses. Transaction levels are around 100,000 each month (1.2m-1.4m transactions pa), which is no real change since 2014, but what has changed is the mix of transactions.

We have seen a clear shift towards first-time buyers, assisted by government schemes such as help to buy, away from cash and Buy-to-let (BTL), with the purchase market quieter and likely to stay so due to low number and both the selection and type of homes available.

On a positive note, this has been more than compensated for in the intermediary space by the rise in both residential and BTL re-mortgage business, and with the majority of lenders now offering retention procuration fees, intermediaries have responded by improving their client CRM activities.

The number of new BTL purchases is down, largely due to government intervention and the PRA’s actions, where, as a direct consequence of the stamp duty change, we saw BTL purchases between March & August 2017 drop from 1 in 10 to 1 in 17.

Whilst there are reasons for caution, the further first-time buyer incentives announced in the Budget – lessening the burden of Stamp Duty Land tax, combined with the prospect of further interest rate rises – continues to prompt customers to reassess their current arrangements, creating substantial opportunities for intermediaries who are close to their clients. Next year, for example, there is an estimated c.£215bn in residential maturities, and further £24bn in BTL maturities and with debt service costs remaining at historic lows, there is an encouraging environment for increased home movement activity.

It is particularly encouraging to witness such a competitive Lending market, with the Building Society sector and new and challenger banks prospering and more than filling the gaps left by the big lenders. As such intermediaries are continuing to see a good range and choice of competitive mortgage and re-mortgage deals for clients, bolstered by their improving cross sales competencies.

2. Background & Economics

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Financial technology should be relatively unaffected by Brexit where “some already see London as the world’s most vibrant fintech hub”. 2018 will also bring with it a further raft of ‘big ticket’ changes, not least the Open Banking reforms which will start off relatively small in the form of current account data, but will soon spread far and wide, and should be a real boon to advisers as they seek, for example, to prove client affordability with lenders. We’re already seeing software solutions being offered in this area, and we suspect this type of emerging technology will develop rapidly throughout the next 12 months.

Looking at the broader financial services sector, there is rising consumer demand for independent financial advice across all product areas. The intermediary channel now generates more than 70% of all mortgage transactions in the UK. Driven by rapid adoption and expansion technology, WRAP architecture, used in the wealth space by IFAs, now controls the mass of Assets-under-Management, where clients and their advisers are demonstrating a real demand for low cost, yet high value and often complex services. Intermediaries are therefore well placed to expand their share of the consumer wallet. Indeed, retail adviser numbers continue to rise (now higher than on the eve of RDR), and Mortgage adviser numbers (including mortgage brokers and IFAs with mortgage permissions) are growing too, now standing at c.10,000 individuals.

UK banks, the top 6 of whom encompass c.80% of all branch outlets, are rapidly moving towards digitally focused models, retreating from the high street as they take more banking services online and on to digital and mobile platforms. These are actions that are irrevocably changing retail banking and, despite some commentary to the contrary, we believe that intermediaries will benefit, particularly from the associated technological developments – leading to both significant reductions in process costs and better customer outcomes, it will also strengthen the hand of the intermediary channel.

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The opportunities within the Protection market are often shown in relation to the ‘protection gap’ which is currently estimated to be around £2.4 trillion in the UK. In recent years, growth has been ‘at best’ limited in the Life, CI and Income Protection space – despite a seemingly obvious client need for these products.

Equifax Touchstone recently released data which identifies areas where sales have declined, namely critical illness, decreasing term with critical illness, relevant life and term products, the former having seen a fall of 9.4% in the third quarter of 20171. It is therefore incumbent on us all to work harder in helping to educate clients in the value of having life insurance of varying types.

1 Professional Adviser, ‘Protection product sales hit five-year high – Equifax Touchstone’, 11 December 2017 https://www.professionaladviser.com/professional-adviser/news/3022785/protection-product-sales-reach-five-year-high-equifax-touchstone

The anticipated entry into the market in 2018 of new Providers is testimony to the scope of the opportunity and will aid healthy competition in the protection market. However, we continue to advocate and encourage Providers to simplify the protection application and support process, as well as develop products which cater to the more complex medical scenarios which we have seen an increase in demand for via our Protection helpdesk.

Thankfully, we are now seeing the development and adoption of enhanced technology both at point of sale and within the application and underwriting process, and we remain keen to embrace innovation, particularly in terms of technological advancements. As an example, we have worked closely with iPipeline’s SolutionBuilder tool, providing this free of charge to member firms, many of whom have witnessed a marked uptake in average case sizes.

Recent data released by Equifax Touchstone indicates that “Protection product sales have reached a five-year high, with total sales up 1.4% in the third quarter of 2017 and 7% year-on-year”1, which is clearly a step in the right direction.

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As we have come to expect in our industry, 2018 will bring with it a plethora of regulatory changes that are no doubt daunting to many of us. It is paramount that firms understand all changes and are able to explain these in plain language to clients before providing advice. The penalties of getting it wrong are high and could at best damage reputation and at worst cost a firm their livelihood. There is clearly much work to do and our commitment to continuing to support all DA firms through the impacts and requirements of FCA and PRA regulatory changes remains unchanged. In this section, we will look at the Buy to Let market in detail before exploring other regulatory changes that lie ahead.

Regulation in the Buy to Let Market

Buy to let (BTL) continues to be a target of suppression from regulatory change. The impact of the increase in stamp duty for purchases of second homes introduced in 2016 has had a dampening effect for some landlords. The 10% wear and tear allowance was abolished from 6th April 2016 and replaced by actual invoices for work carried out on a property which has further limited the tax relief that landlords could benefit from. In addition, the changes to Mortgage Interest

Tax Relief (MITR) on BTL properties will start to bite at the end of this year where landlords will see further reductions in their income. These changes alone could see some landlords start to off-load property that are no longer viable assets.

The PRA have also introduced a staged approach at standardising the underwriting requirements for BTL mortgages. This began in January 2017 with an industry standard rental stress calculation that should take into consideration a landlords’ changing tax position. The rules do have some built in flexibility when using 5 year fixed rates or transitional rules where no further borrowing is required. Lenders must now consider the implications of MITR on the landlord’s income and again consider if the client was going to fall into a higher rate tax band where these tax relief changes were having more of an impact. This change has caused landlords look at holding their property in Special Purpose Vehicles (SPV) set up as limited companies. These SPV schemes are protected against the higher rental stress calculations as the client does not pay income tax but corporation tax instead. The industry is subsequently starting to see a shift towards limited company BTL purchases which won’t go unnoticed by HMRC.

From October 2017, the PRA set specific policy around a Lender having to underwrite portfolio landlords differently compared to a normal investment landlord

3. Market Regulation An update from Paradigm's Mortgages Technical Director, Christine Newell

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client. The PRA defined portfolio landlords as a landlord with 4 or more mortgaged BTL property held separately or in aggregate. The flexibility within this definition has allowed Lenders to have some poetic licence in their interpretations of the rules. Advisers must now learn what these nuances are in each Lenders’ criteria and when to use certain Lenders for a more complex BTL case. Paradigm has been leading the way with extensive support and guidance made available to all member firms.

In April 2018, a further change in the law for landlords will see minimum energy efficiency standards introduced. It will be unlawful for a landlord to rent a property that has an Energy Performance Certificate lower than an E rating. This will affect property rated at F and G and landlords will be compelled to improve the energy performance ratings of these properties or risk fines of up to £4,000 and Paradigm would recommend that advisers remind their landlord clients of this with plenty of time to make any necessary changes.

All of these changes have hardly been given time to bed in before the next ones have been announced, and we are yet to feel the full impact of them on the BTL market. We have seen an increase of calls to the mortgage helpdesk from advisers with queries around these criteria and so we will continue to deliver updates and training around these areas to support the DA community.

Senior Managers & Certification Regime

The SMCR is high on our agenda and sets out the guidelines on implementing personal accountability and responsibility for areas of a business. During the financial crisis of 2008 not a single British banker was held accountable for the collapse of the UK finance sector, whereas in Iceland 29 bankers were given combined jail sentences amounting to 74 years. This Government commissioned review and report showed that personal accountability and responsibility for areas of a financial business would help protect the UK finance sector should this happen again.

The SMCR was implemented on 7 March 2016 in Banks, Building Societies, Credit Unions, Large Investments Banks regulated by the PRA and branches of Foreign Banks operating in the UK. The FCA are planning to extend the SMCR to all FCA regulated firms in 2018, the consultation closed on 3rd November 2017 and final rules to include these areas will follow. We are working closely with our firms and members to ensure they are kept up to date with actions required to ensure they are fit for purpose ahead of Summer 2018. The SMCR regime does not cover off how a Network will manage the responsibilities of their AR firms and neither does it deal with “one-man bands” and sole traders. The Certification Regime and Conduct rules will affect all advisers and staff within our Mortgage and Protection member firms, and we will be issuing guidance for this during our 2018 CPD workshops along with newsletters and a countdown to getting SMCR ready.

What lies ahead?There are many other regulatory changes and consultative publications due to be announced and implemented in 2018 and we will give guidance on these, however, our main focus will be on 4 particular changes, as follows:

• Senior Managers & Certification Regime (SMCR) – Summer 2018

• General Data Protection Regulation (GDPR) – 25 May 2018

• European Securities and Market Authority (ESMA) – 3 January 2018

• Markets in Financial Instruments Directive 2 (MiFID ll) – 3 January 2018

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General Data Protection Regulation

The GDPR is an EU directive which will take effect on 25th May 2018 and is the biggest change to data protection laws since the Data Protection Act 1998. The government has confirmed that the GDPR will take effect irrespective of UK’s decision to leave the EU. GDPR will apply to all businesses operating in the UK, which of course includes all DA intermediary firms.

The way we process and store data has changed significantly over the last two decades. Influenced by technological progress and our communication methods, it has opened another world for transacting business and how a customer’s data is shared between organisations. The Information Commissioner’s Office (ICO) have produced a document to help firms as they prepare for the changes ‘Preparing for the General Data Protection Regulation (GDPR)’, which lists 12 steps for immediate action. We have strongly recommended that firms review these steps as a starting point to see what action may be required ahead of the new rules being introduced.

Cyber-crime and attacks are on the rise and we encourage every business to take steps to protect themselves against such attacks. Not only could a successful attack leave a business unable to function for a period of time, there is also a risk of legal action being taken by those affected as well as the reputational damage it could cause too. The GDPR brings new obligations to firms in terms of reporting data breaches, as well as notifying the supervisory authority (the ICO in the UK) and the individual(s) whose data may have

been breached. If you fail to notify relevant parties about a minor breach when you were supposed to, this will result in a fine of up to €10 million or 2% of total global annual turnover (whichever is higher), and if you fail to notify relevant parties about a major breach, this results in a fine up to €20 million or 4% of total global annual turnover (whichever is higher).

Firms will need to do and understand the following areas amongst other things:

• Understand the data they hold and how it is processed, and importantly whether this adheres to the new regulations

• Understand their client’s rights including the right to be forgotten, their business culture, their IT function, ability to hold client data in a central place where it is easily retrievable

• Have the ability to encrypt and send data securely

• Have the ability to respond to suspicious activity and report requests quickly and efficiently

We continue to give guidance to our firms via our dedicated website page, bulletins and updates as well as offering an outsource facility to a 3rd party IT Governance who will have the appropriate expertise to assist our firms at a business cost. Other resources, such as the Information Commissioners Office, will be actively promoted to engage firms with the requirements needed.

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MiFID ll and ESMA

MiFID ll and ESMA are both aimed at firms who have investment permissions, so many of our Mortgage and Protection only member firms are not affected by the new rules being implemented in January 2018. These areas will predominantly affect our IFA Wealth Management partner firms, and therefore we will continue to support our colleagues within Paradigm Partners in delivering information to our firms, this will be via specialist Best Practice workshops, Target newsletters and one to one visits. We have already provided a huge amount of support, ranging from supervisory courses to special editions of our Target newsletter and frequently asked questions.

In addition to the aforementioned areas of regulation, along with these areas there are some other regulatory changes and review papers where action may impact our member firms:

• The Insurance Distribution Directive (IDD) – January 2018 summary and Policy statement due

• Financial Advice Market Review (FAMR) – December 2017 summary and policy statement

• Payment Services Directive 2 (PSD2) – January 2018

• The Ageing Population review – Occasional Paper 31 published by the FCA September 2017

We will be following the developments on these consultation papers, keeping our firms up to date with details of what they will need to do to implement any actions when final rules and policies are announced.

We will continue to work closely with our strategic partners and trade bodies such as AMI and UK Finance – the latter being a merger of 6 previous trade bodies including the Council of Mortgage Lenders (CML) – in all regulatory matters.

Paradigm can sum up ESMA, SM&CR and MiFID ll by the following:

ESMA rules ensure firms are competent

MiFID ll rules are how the firms systems and processes ensure they are competent

SM&CR rules ensure the firm knows who is responsible for each area of their business

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4. Paradigm’s BusinessFollowing TAM’s interim statement with our half year results, it is apparent that 2017 has been Paradigm’s best year yet with Mortgage, Asset & Discretionary Fund Management and Protection sales all at record levels. Organic (net) recruitment of new members and sales growth continues at significant pace. We will continue to invest in the organic growth of our business particularly where we see an outcome that takes the customer and adviser experience to another level. Should the opportunity present itself, particularly as a consequence of our market floatation and financial strength, growth may also come via acquisition, potentially bringing with it additional scale, new skills, opportunities and expertise into the Group.

Raised via successful IPO on AIM in July 2017, including £10m new money, followed by

a strong period of organic growth

£51.6mIncrease in Group Revenue

£5.6m

£7.3m

31%2016 2017

Won the prestigious ILP Moneyfacts 2017 award for "Best Discretionary

Fund Manager" in September

Averaging over £80million of assets under management added per month

+£80m

Assets under management Up 15% since March 2017 and

up 33% over 12 months

£4.4bn 33% 286 38%

Number of firms using Tatton Investment Management, a 38% increase from 1H16

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Paradigm Mortgage Services

Despite the hurdles created by what can often appear to be a consistently challenging regulatory and economic environment, intermediaries have benefitted significantly in recent years. Today, the intermediary channel accounts for >70% of gross sales, with 2017 market completions on track to exceed £250bn. It should be borne in mind that these gross market figures exclude retention business which is currently estimated at c. £80-100bn. If that business is taken into account, today’s intermediary share of wallet would be c. 56%, based on Lenders’ channel dominance in this sector, where they are currently responsible for c. 80% of all retention business. 2018 forecasts vary; however, the current consensus suggests a c. £252bn market with an intermediary channel share trending towards >72%.

Paradigm Mortgage Services’ growth outstripped the market during 2016 (up 34.2% vs. 2015). As a public company we are now restricted in only being able to comment on information that is in the public domain, however in the first 9 months of 2017 completions are at £4.26bn, following total lending in 2016 of £4.71bn. We are confident that we will continue to gain further ground on competitor distributors, as witnessed by our growing membership, which is up 13% since September 2016.

Paradigm Partners have seen strong growth in the platform assets, AUI, on the Paradigm Wrap,

which has increased to £3.26 billion

356£2.86bn

£3.26bn +14%

2016 2017

Number of member firms, up 13% to 1,143

since September 2016

1,143

IFA firms using Paradigm Partners’ bespoke regulatory compliance consultancy services

£2.99bn

+27%

Gross lending through Paradigm (April - Sept 2017), 27% higher than 1H16

and above market growth of 8%

439

+29%

Firms registered to use Paradigm Protect, up 29%

from September 2016

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The Intermediary Mortgage Market

We have recently seen an increase to the Bank of England base rate (BBR), in fact, the first rise for over 10 years, which as many predicted is now stimulating activity in the remortgage market. Whilst we are not much further along with understanding exactly what Brexit will mean to the wider UK economy, perhaps outside of the Brexit issue, housing has now become our government’s top priority.

As mentioned, the remortgage market is still moving forward, but with less properties coming to market and the number of new build properties remaining well below a sufficient level to meet housing demand, intermediaries are using the opportunity to work through their back book of clients in an effort to obtain better deals for them, saving their clients’ money and providing security around their monthly out-goings. The increase to BBR presents the perfect time to secure longer term fixed rates which may not be available again during the clients’ lifetime. Fortunately, intermediaries are best placed to help clients through the re-mortgage maze and affordability criteria as they have access to the whole of market including intermediary only lenders and semi-exclusive/exclusive deals. It was encouraging too that we did not see the usual dip in activity over the summer months, indeed, July and August proved to be very buoyant both for mortgage applications and completions.

2 Council of Mortgage Lenders, ‘Market commentary September 2017’ https://www.cml.org.uk/news/news-and-views/market-commentary-september-2017/3 Nationwide House Price Indices, ‘London house prices fall for first time in 8 years’ September 2017 https://www.nationwide.co.uk/~/media/MainSite/documents/

about/house-price-index/2017/Sep_Q3_2017.pdf

Property transactions have been driven by first time buyers (helped by government schemes such as the Help to Buy equity loan scheme, London Help to Buy and Help to Buy ISA)2. Contrastingly, only 2 years ago home movers were responsible for the majority of transactions. BTL activity has dropped by over 30% since July 2015, which reflects the continued uncertainty in this market due to the ongoing regulation and taxation changes. Additionally, Nationwide Building Society reports in its September 2017 House Price Index that in London, which is so often the driving force in the UK property market, property prices fell for the first time in 8 years3. However, this needs to be put into context with London house prices over 5 years growing by nearly 40% (Zoopla) and 325% over the past 20 years. What is encouraging to note is that regions such as the East and West Midlands, East Anglia and the South West are showing consistent and sustainable house price growth as buyers take advantage of lower mortgage rates and more affordable stock.

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The most significant impact on the BTL market this year has been the PRA changes for portfolio landlords which came into force at the end of September, along with continued feed through of changes to taxation which will be fully felt as we move into 2018. Our view is that the decline in the BTL market will continue for the next 2-3 years as it adjusts to these measures and advisers and lenders move the market forward to its next phase.

The Older Borrower Market: Later Life Lending and Equity Release

One market which continues to grow is the later life lending market, which encompasses lending to older borrowers and equity release (ER). Once again, ER is producing double digit growth and is poised to break through the £3bn barrier in 20174. Place later life lending alongside this and it is easy to see the opportunities that this segment presents for advisers. More Lenders are looking at lending products with exit strategies as opposed to the ER route, which provides advisers and borrowers with more choice and flexibility regarding their needs as they move towards, and into, retirement. More and more people are looking to the equity contained in their property as part of the solution to their retirement needs: be it helping the younger generation get on the housing ladder, replacing pension income, or long-term care costs, this market is set to continue to grow, and more mainstream Lenders are looking at how they can effectively tap into this segment.

4 Money Marketing, ‘Equity release market set to hit £3bn this year’, 13th September 2017 https://www.moneymarketing.co.uk/equity-release-market-set-hit-3bn-year/

There has also been an overall trend of innovation in the ER market; more providers and products have come to market with the aim of supporting older borrowers and lending money to those of retirement age, making it a much more viable option for clients. Alongside this increased competition, there has been a significant decrease in the cost of these products to the consumer. Paradigm will continue, via its panel of Providers, to promote ER propositions to those amongst its membership who are appropriately qualified to give advice. Members who are not qualified will be given assistance in developing ER business services, and help in obtaining relevant qualifications, or support in working with our chosen referral partners.

The BTL market is still a £30bn+ arena to participate in, and the recent PRA changes in particular mean that the role of advisers in this market is even more important than ever before.

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We believe that at Paradigm we are in a prime position to capitalise on the positives that are happening in our market. We have invested in our people and in technology to increase efficiency and bring a superior service to our members.

To generate new business growth, we firmly believe in the value of meeting potential new firms face-to-face, and were the only Mortgage Club to exhibit at all of the FSE and MBE 2017 expos. This has helped raise our profile and has also aided in bringing new firms to Paradigm, with our average number of new firms per month now at 15.

We have been working closely with Castlight Financial to bring their innovative technology to the entire intermediary community in line with the Open Banking initiative. Their fintech solutions offer major benefits to intermediaries, lenders and providers. Version 2 of their ‘Affordability Passport’ will be delivered in Q1 2018 and we hope to bring more news on this exciting initiative to you in the near future. Their tool provides a complete view of a customer’s financial capability, affordability and creditworthiness in minutes. This tool doesn’t simply save time for applicants and their intermediaries, it also helps in terms of the quality of business and aids in reducing mortgage fraud. There are clearly opportunities in respect to Know Your Customer for IFAs too.

In the first nine months of 2017 we attracted 137 new member firms, bringing our total number to 1,143 DA firms (as at the end of September 2017). As a consequence of this growth, our share of the intermediary wallet has increased accordingly, as demonstrated in Chart 1.

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Paradigm's growing share of the Intermediary market

Intermediary Lending Lending via Paradigm

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Paradigm Protect

Since launch in 2014, Paradigm Protect has established itself as an important business support unit to Paradigm firms in the protection space. The scale and quality of business submitted via our Provider panel continues to deliver both high persistency levels and average premium sizes. This places Paradigm as a major distributor within this sector of financial services, however, our differentiator is quality and to achieve this we work alongside firms with the highest professional standards. Demonstrating this, Paradigm was commended in Legal & General’s 2017 Business Quality Awards for Customer Excellence.

In 2017 we have added to and in some instances consolidated existing product types, offering some unique and bespoke products to member firms. This builds on one of our core goals, which is: to deliver the most comprehensive range of Protection products and choices for our firms and their clients. In addition to individual life insurance, we continue to support IFAs operating in the SME space. The addition of bespoke products to the range of Group Risk products initially launched during 2016 has had a positive and marked effect on new business levels in this area. We will continue to invest in our protection proposition to further increase our profile in this market and anticipate new business volumes increasing substantially during 2018.

439 firms have now aligned themselves to Paradigm Protect (as at the end of September 2017), and in July and August we saw our two highest months for recruitment since 2014. We estimate that Paradigm firms now write in excess of £20m AP and the number of business writers is increasing at a steady rate.

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This year, we have delivered the largest ever number of CPD events since inception due to member demand and our format has been well received by advisers, who benefit from the 30 minute roundtable sessions which allow them to truly engage with Providers. We started 2017 with a series of events focusing on technology in the protection space and encouraging advisers to embrace innovation and the IT tools available to them, designed to make the protection sales process smoother for all involved. Our initiatives with technology have been a key factor in our success to date; we have, for example, been offering members free Solution Builder licenses, as well as developing our own bespoke product comparison software with F&TRC. In addition to events, we have been filming educational videos with Providers, which have been a new innovation this year and will continue into 2018 as we recognise the popularity of videos as a means of communicating messages to intermediaries.

@ParadigmProtectOur social media activity has increased significantly in 2017, and we now have over 800 followers on the Paradigm Protect Twitter account. We are proud to be the only Distributor who has given protection a focus in this way.

We offer a unique and comprehensive website dedicated to life, group and GI to our member firms. This intuitive website was rebranded in line with the flotation of TAM in July, and offers an unrivalled host of marketing and product information, with access to valuable research technology and compliance support. We are continually looking to improve the site, and added significant content in 2017 including the addition of filmed interviews with various Providers in which we discuss industry ‘hot topics’.

The long-term objectives of Paradigm Protect remain to:

• Deliver the most comprehensive range of Protection products and choices for our firms and their clients – this included a definitive “no loaded premium” stance

• Give intermediaries access to market-leading terms and a higher quality support and associated product material, primarily via the Paradigm Protect website www.paradigmprotect.co.uk

• Continue to assist firms in the growth and development of our firms’ protection sales, including by providing ongoing training and development via CPD events

• Build Paradigm Protect into a profitable, professional and sustainable business

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General Insurance

Following the success of activities undertaken in 2016 and 2017, we have made considerable strides in our understanding and knowledge of the types of GI business written by our firms, whether this is written directly or a referral to one of our GI Providers. We have actively encouraged firms to consider GI, for example for their landlord clients due to the recent regulatory changes in the BTL market; which received good press activity in the October edition of Mortgage Introducer.

We enhanced the GI section of the Paradigm Protect website, where we recognised the importance of encouraging intermediaries to write, or at least refer, this kind of business. Clearly, the risks of letting clients venture onto comparison websites are great – not only are they likely to select a cheap policy that doesn’t adequately cover them, but this also opens the door to losing their business on other products given these websites now offer everything from mortgages to ISAs, Life Insurance to Landlords Insurance.

All GI business produced by Paradigm firms is included within the profit share scheme, making our GI proposition particularly commercially compelling.