56% of advice practices never formally valued

Mike Taylor

Managing Editor and Publisher

18 June 2026

More than half of financial planning practices have never been formally valued and more than 60% of practice principals have no documented succession plan, according to a research report undertaken by Business Health.

The so-called “What if” report is based on a survey conducted in May which asked questions in six areas to determine the level of preparedness of financial advice firms in the event of the unexpected death or permanent disablement of a business owner.

The firm said the survey covered a near-even split between self-licensed businesses and those using external third-party licensees and noted that practices with higher revenue were more likely to have succession agreements in place while businesses with a single owner are often the least prepared despite carrying the greatest individual risk.

According to Business Health, which is focused on consulting to and advising advice firms, the findings and will likely use it as a marketing tool, “highlight a clear and urgent gap between awareness and action across the industry”.

Dealing with the six questions, the report claims that although succession planning is widely acknowledged as important, it is rarely formalised with 67% of principals surveyed not having documented (succession, buy/sell or partnership agreement for example) to maintain and/or buy your business in the event of their sudden death or suffering permanent disablement in place.

It said this creates real risk, not just operationally but financially “particularly for the family of the owner and the clients who may be left exposed”.

The survey also found that 56% of practices have never had their business formally valued, suggesting that owners may hold unrealistic expectations of value and that opportunities to optimise capital value within the current regulatory framework are missed.

It suggested that self-incensed principals face greater operational risk, particularly who can legally service clients, noting that external licensees can provide support, but only in terms of responsibilities being clearly understood and planned for.

The research found that 41% of practices rely on a single adviser, creating immediate continuity and key person risk.

“While most businesses employ staff, there is uncertainty around whether staff are prepared, informed or capable of maintaining operations during a crisis,” it said.  “Without clear communication and contingency plans, even well-staffed businesses remain vulnerable.”