Pensions  

Polson warns of platform large legacy burden

Polson warns of platform large legacy burden

Life company platforms with large legacy business could get caught out by pension flexibility demand, independent consultant Mark Polson has warned.

Mr Polson, founder of consultancy The Lang Cat, said: “For those running off older systems – particularly life companies that have big heavy mainframes – it is harder to say everything will be ready in time.

“If you are going to promote your systems heavily and say what you can do ahead of the pension changes, please be sure about what works.”

Article continues after advert

Large life companies with their own platforms include Standard Life, Aviva, Old Mutual Wealth and Friends Life, although no suggestion was made these would face problems with being ready for the incoming changes.

Stephen Wynne-Jones, head of marketing for Cofunds, which is owned by Legal & General, said: “We are going to be ready with flexi-access drawdown from day one. We are seeing this as business as usual.”

Mike Morrow, sales and marketing director for Ascentric, said the changes were an opportunity to consolidate forms of potential retirement income, including pension and Isa portfolios.

Daniel Harrison, senior partner for True Potential, said the organisation would unveil new technology at its adviser conference in March.

An MGM Advantage spokesman said it was developing its annuity to include underwritten pricing based on an individual’s lifestyle, and working on a retirement account combining the features of drawdown and annuity.

Geoff Mills, director of fund ratings and research group RSMR, said: “The people within advisory firms themselves are best positioned to undertake due diligence and select the platforms they wish to use.”

Last week, Old Mutual Wealth announced that the incoming flexi-access drawdown options would be available to all of its existing and new collective retirement account customers and for all nominated beneficiaries, in the event of a customer’s death, from 6 April 2015.

Adrian Walker, Old Mutual Wealth’s retirement planning manager, said: “We believe that people should be trusted with their pension savings and so are pleased to be offering flexible access aligned with the new rules.”

David Tiller, Standard Life head of adviser platform propositions, said: “The changes required to bring this proposition in line with new ‘flexi-access’ drawdown are relatively minor, most notably continuing to allow contributions up to the annual allowance of £10k once a client enters drawdown. We are therefore very well prepared for the changes in April.”

Adviser view

Mark Hibbit, director of Bristol-based Sovereign IFA, said: “Providers should proceed with caution, as should advisers when choosing which platforms to use.”