Responding to the FCA’s announcement on changes to advice on pension transfers, Philip Brown, Head of Policy at LV=, said: “The regulator’s changes to pension transfer advice are welcome news for people approaching retirement. Since the Freedom and Choice reforms, there has been a stark rise in the number wanting to transfer out of their defined benefit schemes and it’s vital that as an industry we ensure there are strong safeguards in place to protect these savers. We wholeheartedly agree advice on transfers must be a personal recommendation and explicitly showing the value of benefits given up should help ensure people aren’t unduly influenced by a big transfer value.
“We are also pleased to see the publication of a second consultation paper as, with so much at stake, it’s right the regulator continues to look at this market. In particular we welcome the review of contingent charging as, if an adviser’s fee solely depends on the transfer going ahead, there is potentially a major conflict of interest. The regulator’s continued focus on this market is absolutely necessary to ensure that only someone who would benefit from the freedoms transfers out, and not anyone who would be worse off as a result.”