Robo-advice needs human element, firm says

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A wealth advisory firm has urged regulators to ensure robo-advice maintains a human element.

Cigna Wealth Senior Financial Adviser Zoe Downs has said a balanced approach must be struck when dealing with robo-advice. Downs said the trend could be potentially damaging for financial planning and confusing for consumers. She said Cigna had welcomed the establishment of an ASIC robo-advice taskforce to investigate the suitability of new robo-advice entrants.

"Any investigation into robo-advice should ultimately focus on the best interests of the client. It’s beneficial to leverage off technology to help reduce investment costs but regulators must ensure that advice is compliant and appropriate," Downs said.

Downs said Cigna maintained the view that there was "no substitute for personal service" when offering retirement advice.

“It’s hard to replace having the ability to discuss your dreams and aspirations with an expert face to face and put together a personalized retirement plan that is specific to your needs," she said.

“What the authorities need to do is make sure consumers still get the benefits of personal expertise as well as technological advances.”