Scottish Widows has become one of the first providers to launch a ‘pensions passport’, following the regulator stating last year that an alternative to the existing wake-up pack must be found to help reinvigorate the retirement income market.
FTAdviser understands the passport was launched four weeks before the pension freedoms kicked in on the 6 April.
The document, seen by FTAdviser, is just over one-page and gives savers a summary of a client’s pension details, including the policy number, retirement date and value. It signposts to advice and refers to the Unbiased adviser search website, and also mentions guidance service Pensions Wise.
Scottish Widows has beaten to the punch a similar initiative that is current the subject of government testing, after the Treasury partnered with LV at the end of March to begin a pensions passport behavioural trial with consumers.
Earlier this month, LV said a concrete timescale for the pensions passport may become clearer after the election.
The passport would replace existing lengthy disclosure documentation sent by insurers and was first proposed by the Pensions Income Choice Association four years ago.
The regulator’s retirement income report, published in December, proposed new measures including a pension dashboard and an alternative to the existing wake-up pack, enabling consumers to view all their lifetime pension savings - including state pension - in one place.
Robert Cochran, at retirement specialist at Scottish Widows, told FTAdviser that its passport is currently sent out with wake-up packs, which include a one-page Pension Wise flyer, a Money Advice Service pension guide, a statement of benefits, and a guide on helping prepare for their retirement.
“I think we are one of the first to do this,” he added.
On Twitter, Tom McPhail, Hargreaves Lansdown’s head of pension research, commented that the pre-retirement customer pack was “clean and simple”, adding “this is what pensions passport was aiming for”.
Stephen Lowe, group external affairs and customer insight director at Just Retirement and a Pica member, told FTAdviser that all providers will be trying to break this kind of ground, complementing them for being bold.
When described to Mr Lowes, he said that Scottish Widows’ passport is not a blueprint, “but it’s a good start that they have taken”. He added: “They are 80 per cent there”.
Phil Brown, LV’s head of retirement proposition and change, told FTAdviser that they are working with the Treasury to create a pension passport that sets out clear, consistent, data and highlights special features, in lieu of the current wake up packs.
“The key to a pension passport is that it is recognisable regardless of which provider issues it. We believe that this will make it easier to demystify the pensions landscape and increase consumer engagement which will in turn improve income outcomes in retirement.”
Mr Lowe added that what the industry needs to know is what happens in terms of outcomes, pointing out that behavioural trials will show what elicits the most responses.
donia.o’loughlin@ft.com
