When pension providers suit themselves

Mark Osland

Advisers seem very quiet regarding many group pension providers stopping commission payments from this autumn, justified on the basis of charge cap legislation – which is not yet in place.

I have asked Scottish Widows and Aviva to explain what right they have to do this, and have only had vague responses mumbling about “terms and conditions” – despite insurers such as Scottish Life, who operate under the same legislation, not altering existing terms until the rules do change.

Such apparent reneging on terms has forced us to do the same by revisiting corporate clients to ask for payment to do things that were originally covered by commission. In many cases, insurers have rubbed salt into the wound by delaying any reduction in plan charges – which did include commission – for many months after the date they stopped paying commissions.

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Perhaps the trade media can get a proper justification from the guilty insurers, but for the rest of us having to deal with the fallout, at least we should remember which providers honour terms and support advisers, and which do not.

This is not a matter of fee versus commission.

Mark Osland

Director, Formula, South Croydon