Several large pension providers, especially the so-called Zombie funds, have said they are not certain what they will be able to offer consumers from 6 April.
According to a spokesman for the Phoenix Group, which has 2m policyholders, the company is still unsure about what will be on offer for its clients from April, but confirmed that it would allow customers to take the full encashment from age 55 option as a minimum.
A spokesman for the firm said: “Giving our customers’ flexibility is important to us and where we don’t offer the full range of options we are looking to establish partnerships with other providers to offer more complex products to our customers.”
Equitable Life, which has more than 500,000 policyholders, at first declined to comment, but later said it will not be launching any products but will be offering its clients some flexibility in how they take their savings out.
Other large providers said they were ready for people to cash in after 6 April, but would have to wait and see what sort of products needed to be developed.
Adrian Boulding, pension strategy director at Legal & General, said his firm would not be launching any products before 6 April, but would be waiting to see what his clients wanted before designing a new offering.
“Having said that, we are ready for customers that want to take all their savings as cash. If we have early policies that do not offer the pension freedoms then we will offer a free transfer to a more modern policy”, he said.
Mr Boulding added that L&G’s closed-book policies did not pose a significant problem for the company because they are all old policies with the firm, so were on the same system.
However, L&G declined to reveal how many pensioners would need to transfer because it was market sensitive information.
Meanwhile, Friends Life said it supports the changes to be ushered in and has already changed triviality limits to £30,000 on its policies and increased the GAD maximum on drawdown policies from 120 per cent to 150 per cent.
A spokesman for the firm said it was currently working on “a number of developments”.
LV= and Aegon UK are among the few providers who have already announced their post-6 April propositions.
Adviser view
Chris Daems, director of London-based Principal IFAs, said: “Providers should have been gearing up to accommodate the freedoms for some time.
“However there is a possibility that some providers have failed to accommodate the changes in sufficient time.
“I’d also suggest that the reforms are an ideal opportunity for consumers to consider their own objectives with these pots of money and to work out how the reforms will work in the favour of the switched on individual who takes time to prepare.”
