PP - Lemonade launches impartial transfer advisory service
Lemonade Reward has set up an advisory service for defined benefit (DB) transfers after its research found many members lack access to good advice and information.
The impartial service launched this month to deal with issues around transfers and ensure members maximise their retirement income, is available to current and past employees in a deferred DB scheme.
The firm's managing partner David Pugh said: "Our advisory solution removes the pressure on pension teams who are often trying to cope with numerous member and IFA requests and reduces the financial risk to DB schemes (as transfers out benefit the funding position)."
He added the portal provides better quality management information with a single view of what is happening, gives better value due to economies of scale and ensures the best outcome for members.
It comes as a survey conducted by the firm found 81% of employers fear members are not getting DB transfer advice they can understand.
The study, which contains feedback from 63 companies representing 1,075,605 members conducted from 2 to 17 November, also highlighted 85% of schemes failed to show DB pension transfer values on members' annual statements.
Under a fifth (16%) of schemes received over 100 transfer requests per month, under half (44%) get 10 to 100; some 40% received under 10 transfer requests per month, and just over three quarters (76%) of schemes did not offer partial transfers.
Pugh said the results show there is room for improvement:
"Schemes must make it easier for people to access their cash equivalent transfer value, provide transfer option information online, and give advice they can understand and trust."
The same study revealed 78% of schemes allowed one or more free requests per year, but 63% did not have an online portal to help members explore transfer options.
Meanwhile, just 15% of schemes provided transfer values through an online portal, and under a quarter (23%) provided information on transferring out of a DB scheme.