Simplybiz has addressed adviser defined benefit pension transfer concerns by launching a new service which allows advisers to outsource clients seeking to move out of a defined benefit pension scheme where they do not hold the relevant qualifications.
From 6 April, it will be mandatory for anyone with a defined benefit pension to take regulated financial advice, except where total savings are less than £30,000. This will be full regulated advice under FCA rules, even where the receiving scheme is regulated by the Pensions Regulator.
Simplybiz’s ‘pension transfer bureau’ has been launched in partnership with Selectapension and will handle money purchase and defined benefit pension schemes.
The service allows advisers to outsource schemes for which they do not hold the relevant permissions, in anticipation of the Financial Conduct Authority’s consultation paper on the subject.
Advisers have frequently pointed to a growth in demand ahead of the new reforms but many have expressed concern over the likely spate of DB transfers, advice for which needs to be overseen by a pension transfer specialist with an AF3 qualification or equivalent.
According to data published by Prudential earlier this month, around a third of those who have a DB pension and are retiring this year could seek to transfer their pension under new pension freedoms coming in from April.
Some advisers have said the fact that transfers are so rarely going to be in customers’ interests could prompt them to walk away from such requests for fear of future claims.
Gary Kershaw, compliance director for Simplybiz, said that the at-retirement reforms next month provide a huge opportunity for financial advisers. “Many of the calls we’re taking from advisers currently are about clients who are eager to liberate their pension funds.
“We believe that this environment means the pension transfer bureau will be greatly needed and valued by those of our member firms who don’t hold the relevant FCA permissions, but want to continue to provide a holistic support offering to their clients.”
Peter Bradshaw, national accounts director at Selectapension, added: “The hugely anticipated changes in April have brought defined benefit scheme membership, both active and deferred, into sharp focus and consumers are naturally concerned to make the right decisions about their retirement income.”
The firm has developed its own Selectapension bureau services to prepare one-off or bulk-non advised reports, utilising either money purchase, income drawdown, defined benefit or qualifying recognised overseas pension schemes.
Mr Bradshaw previously told FTAdviser that the pension changes have brought membership of DB schemes into sharp focus.
Meanwhile, last week Simplybiz made several enhancements to its auto-enrolment proposition, along with an online auto-enrolment planner designed to help advisers and clients keep track of their progress during the lead-up to their staging date.
peter.walker@ft.com
