PensionBee under fire over naming and shaming rivals

PensionBee under fire over naming and shaming rivals

Pension providers have dismissed claims of bad customer service presented by PensionBee in its monthly round-up of case studies.

Capita, Phoenix Life and Lloyds Register have rebuffed accusations from the fintech pension provider which names and shames them, and is accusing the company of not providing correct information.

Regarding Phoenix Life, PensionBee said that provider is charging a 36 per cent exit fee for Ms H pension transfer, corresponding to £9,413.

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According to a spokesperson at Phoenix Life, a market value adjustment (MVA) is applied to Ms H policy in case of a transfer.

The spokesperson said: “MVAs are not exit charges. We apply a MVA to pay out the true market value of a policy which ensures the remaining policyholders in the fund are not disadvantaged.”

The MVA is applied if there is a shortfall between the rate of actual return on the underlying assets after expenses are deducted, and bonus rates are set, she said.

This adjustment depends on a number of things such as the size of the shortfall and the volume of withdrawals from the fund, she added.

Confronted with the differences in terminology, a PensionBee spokesperson maintained that a market value reduction is an exit fee, as it reduces the value of the pension of the customer should they choose to transfer to another provider.

Due to the high value of the charge, Ms H has not decided yet if she will transfer her Phoenix Life pension to PensionBee.

Another case study presented by the fintech provider involves the Lloyd’s Register Superannuation Fund Association Pension Scheme.

The fund is accused of transferring a member’s pension without his knowledge.

Mr K told PensionBee that his pension was with Lloyd’s Register, who then informed the provider that the pension had been moved to Punter Southall, and after that to Friends Life.

Colin Macnaughton, group pensions manager at Lloyd’s Register, told FTAdviser that Mr K has not had any of his pensions arrangements changed.

He said that the “complaint by PensionBee is completely unfounded”.

According to Mr Macnaughton, Mr K has been a member of the defined contribution (DC) of the scheme since 2014 which has always been administered by Friends Life.

He said: “Friends Life have communicated regularly with all DC section members as and when any issues arise.”

Recently, Lloyd’s changed the administration of its defined benefit (DB) section to Punter Southall, but that had no effect on Mr K’s pension.

When contacted about this case, officials at Lloyd’s said to PensionBee that the pension was moved as part of a bulk transfer, the spokesperson said.

He believes that this was an administration error from Lloyd’s.

Romi Savova, chief executive at PensionBee, said: “This case perfectly illustrates the knock-on effects of pension administration errors and deficiencies. It is no surprise that customers feel disengaged from their pension pots.