More than 1,300 Independent Financial Advisers (IFAs) have signed up to the Personal Finance Society’s (PFS) Pension Transfer Gold Standard in its first year of operation. However the society has also reported that some advisers have pulled out of offering pension transfer advice, due to problems obtaining professional indemnity insurance (PII) cover.
The PFS introduced the standard in response to concerns about poor quality pension transfer advice, such as the British Steel pension transfer controversy, which caused many ex-steel workers to lose money in 2017-19 (See Brunel News – November 2019).
The Pension Transfer Gold Standard is a voluntary code of good practice for safeguarded and defined benefit pension transfer advice, based around a set of nine principles. “Firms can adopt and promote this standard and principles, so consumers can better understand and find good advice, and be confident they are dealing with a firm that is going beyond minimum requirements when giving financial advice,” said the PFS.
Marking the first anniversary of the Gold Standard, PFS CEO Keith Richards said “it was encouraging to see so many financial advisers choose to align with this consumer guide and to commit to nine key principles of good practice for advising on pension transfers.” However he added that some advisers had dropped their permissions this year due to problems in obtaining affordable professional indemnity insurance.
James Burgoyne, Director – Claims & Technical, Brunel Professions agrees that the PII market is challenging for advisers in the pension transfer market, but says that cover is available for high quality firms with good claims records.
“Pension transfer work requires the highest standard of expertise and professionalism from financial advisers, so it is fantastic to hear that so many have signed up to the PFS’s Gold Standard,” he said. “We are working closely with our clients who are active in pension transfers, including supporting their risk management efforts, to ensure that they can secure more cost-effective PII cover.”
The PFS issued a press release on the first anniversary of the Pension Transfer Gold Standard, which was reported in Professional Pensions. Details of the PFS Pension Transfer Gold Standard are available on the Society’s website.
Brunel secures competitive professional indemnity insurance cover for financial services professionals. To find out more visit the Brunel website or call Mark Sommariva on 0203 475 3275.