Provider Just has launched a defined benefit (DB) transfer unit to support advisers and trustees with real time transfer valuations and information on individual scheme benefits.
The unit, which is part of its corporate solutions businesses called the Hub, provides a digital platform for advisers to generate transfer value analyses for individual scheme members and for trustees to access up-to-date individual scheme benefits.
Just said it wants to “transform” the way parties implement and participate in bulk DB transfer exercises, which are often done in a broad-brush way, where Tvas reports are generated for all scheme members, not just the ones interested in a potential transfer out.
The service will provide educational material for members and run individual Tvas reports where requested, which it said, should bring down the cost on schemes engaging in bulk transfers.
It has integrated the administration platform of Spence & Partners, a privately owned firm of pension consultants, actuaries, and IT specialists, to be able to produce up-to-date member data in real time.
Just did not want to disclose the cost on pension schemes which want to offer the service but said it would be charging a one-off set up fee as well as a usage fee per Tvas report produced.
David Cooper, chief executive of the Hub companies, said: "We've transformed the way scheme exercises can now be undertaken.
“Hub Pension Solutions uses digital technology to radically disrupt the way scheme specific information can be interrogated and delivered to pension scheme members and financial advisers in real time at the click of a button."
David Davison, director at Spence & Partners, added: "Currently generating transfer value analysis for a large scheme can take months, it's done in an archaic way and costs too much.
“Hub Pension Solutions is a game changer. [It] will radically speed up delivery times and reduce cost."
DB transfer tools are hot on the regulators' agenda, with the Financial Conduct Authority (FCA) publishing its final rules on individual transfers in March, which said it was now of the view it was "unlikely" providing or accepting free software for transfer value analyses would fall on the right side of the regulator's inducement rules.
As a result, many providers who offered such tools for free pulled them.
Also under its new rules the FCA will require all advice on the transfer and conversion of safeguarded benefits to include a personal recommendation and value analyses to be “appropriate” (Apta), meaning they have to be personalised to each customer's needs and objectives.
It also requires a "transfer value comparator" (TVC) to be included within the Apta which will show, in graphical form, the cash equivalent transfer value offered by the DB scheme and the estimated value needed to replace the client's DB income in a defined contribution environment, assuming the investment returns are consistent with the client's attitude to risk.
The Pensions Regulator also expecting trustees to help inform members on issues around pension transfers.
Just said it has produced several versions of its service, which it will launch once any new rules come in.
Mr Cooper said: "The FCA want to ensure this market is safer for consumers. Our new service delivers help direct to members before advice is even considered.
“Only those people who have concluded they have a solid reason for considering alternatives to receiving scheme benefits will be connected with the scheme's appointed regulated financial advisers."
Robert MacGregor, managing director of Corinthian Pension Consulting, which provides advice for bulk scheme transfers, said: "Member help and education is a hot topic on regulators' agendas.
“Hub Pension Solutions has developed an engaging solution to help members understand their valuable scheme benefits and how to compare them to other options available."
carmen.reichman@ft.com
