Most Registered Financial Advisers (RFAs) have figured out that clients with whole of life policies issued before 1 January 2009 can be retained. But what, exactly, can you tell those clients?

Obviously you cannot talk to them about increasing their contracts - as that would be the sale of an addition to a category one contract - in fact, usually a separate contract altogether, clearly a category one product, and that would require you to be an appropriately qualified AFA. But what about other servicing tasks?

Mostly these contracts are being retained for two reasons: either they are so old that they are now accumulating bonuses quite quickly, and so to cancel them would cut off a good return on the next year's premium, or alternatively the life insured has medical reasons for retaining the cover, whatever the cost.

But both of these questions relates to the critical question of whether or not to dispose of the contract. Advice on disposal of the contract could constitute new advice, not merely servicing the old contract, and would therefore be a service on a category 1 product. For that you also need to be an appropriately qualified AFA.

You can answer some basic factual questions and conduct some policy administration. Examples include: reporting the current policy surrender value to a client, or recording a change of address. You may add or remove term riders which have no cash value, or would have a cash value that is less than the sum of the premiums paid (i.e. riders or contracts with a return of premium or partial return of premium provision).

But you may decide that the restrictions are just too tough.

If so, you might want to consider referring those clients to someone authorised to offer advice on the issue of disposal (likely to be the most common reason for the referral).

That being the case, you will want to apply some tough criteria to selecting the adviser you choose. I've laboured the point about someone appropriately qualified - few AFAs understand the background to whole of life products and can understand both their weaknesses (and the reasons why they are rarely sold today) while also recognising their strengths, and specifically the factors to consider before recommending that an individual surrender the contract.

If you can't find someone in your area who is up to the task then get authorised, and specialise in that segment.