Should a STAR pathway exist for intermediaries?
Mark Ormston, IT & Administration Manager, Retirement Line
For the industry to truly tackle pension and investment transfer delays, I believe that intermediaries should become part of the solution too.
I recently attended the presentation by STAR on its work to create a faster more efficient pension and investment transfer process for consumers. I have to say it was an honour to be at such a positive, consumer-focused event.
We heard from Carol Knight of TeX, Caroline Mansley of Criterion, the organisations that jointly founded STAR, and from Tom McPhail of Hargreaves Lansdown who was announced at the meeting as chair of the STAR Steering Group.
I believe the message came across loud and clear: This is it; as an industry we either sort this problem out now or the regulator will be forced to step in and ultimately, this would shame the industry.
As an industry we must do better for the consumer. Retirees moving into the pension savings decumulation stage are shocked at the paperwork and timescales being presented to them.
While currently STAR is, quite naturally, engaging with pensions and investment providers, as the organisations which have most sway over the transfers process, they are not the only firms affecting the time it takes to carry out a transfer.
For this reason, I strongly believe portals and intermediary firms could benefit the STAR project by being a part of the steering group or/and more likely the working groups. I could even see how STAR could ask these companies to join and have service level agreements (SLAs) to aim for and aspire to achieve.
If I take Retirement Line for example – the largest annuity intermediary in the UK* – as a firm we see the process from start to finish. We send off the annuity providers application, we know when the funds have been requested and how, all the way through to funds being received and annuity policy documents sent to the client. This gives firms like Retirement Line a lot of knowledge and MI of the transfer process as whole. This knowledge and data could benefit the STAR steering/ working groups.
I can proudly say that Retirement Line is consumer focused – our motto is ‘providing the best of old-fashioned service with modern technology’. As a firm we are consumer facing the whole time, we are dealing with the pension providers with a letter of authority and we are handling the receiving insurer with any issues they may have.
The reason I mention the above is because firms like Retirement Line don’t only have the knowledge and MI, they will also have a direct impact on STAR partners’ SLAs. Any errors by intermediaries are going to have a knock-on effect for the pension providers and the annuity providers in turn.
It is because of this very reason, I can see how STAR, could support and make a difference to portals and intermediaries.
STAR is there for our industry’s consumers – and bad practices occur not just within provider organisations but also within intermediaries, which could add to delays.
Hence, I can see an argument for intermediaries to have SLA(s) to achieve within STAR. STAR could help ensure intermediary firms are adding value to the process, and not compounding an existing issue.
I fully support STAR as I see it can drive change for the better in our industry and for its consumers.
Should a STAR pathway exist for intermediaries, I would certainly be recommending that Retirement Line joins and I am confident this would encourage others in our market also to do so.
* Retirement Line was responsible for £52 million pounds of pensions savings being transferred into annuities in Q3 last year (Equifax touchstone figures)