Getting to grips with DB to DC transfers
'Did you know that through the Options Transfers service, you can automate a transfer from a defined benefit policy to a defined contribution policy? Now there's not many people know that!' '.
Pension Freedoms has certainly been a disruptor but there is one clear pattern emerging. The level of demand from consumers to transfer from DB to DC is increasing and this trend looks to continue in a fashion of a speeding mini through the streets of Turin.
As a result, the costs of processing transfers out of DB schemes are most likely following a similar upward trend. As transfer requests increase, so too do the required checks and procedures and paperwork, not forgetting risks, audit records and time to complete. Add to this mixture; the FCA’s current investigation into transfer times. [You can see it now, can’t you? Dear Trust-based Occupational Schemes. Get your transfer process sorted, please: says FCA.]
With some occupational administrators missing from the Options Transfers community, their absence is fast becoming glaringly obvious. The impact of this gap will be, if not already, felt right across all parties involved in the transfer – especially by the member. To be forced down the manual transfer route can be frustrating for all involved.
At Origo, we are trying our best to encourage more trust based schemes to make the most of the Options Transfers service in hope that DB to DC transfer times and costs are in-line with the FCA’s observations of the hard work already achieved in the contract-based DC world.
If you would like to see a demonstration of the Options Transfers service, please contact Richard.