Half of UK defined benefit (DB) pension trustees believe that COVID-19 has increased the need for schemes to invest in engagement strategies about member options and provide access to financial advice.
That is according to research by Hymans Robertson, which also found that changes to working patterns due to the pandemic have led to an increased recognition that digital communications with members is important.
Nearly two-thirds of trustees polled by the company believe that digital communications and technology should now be used to engage with their members, up from just 5% pre-COVID-19.
“The rapid increase in the use of technology over the past 18 months has created a need for trustees to be more creative in their communication approach,” said Ryan Markham, partner at Hymans Robertson.
“By engaging with members digitally, employers can ensure that decisions can be made with full and concise understanding to help achieve retirement goals.”
The research also found a large increase in the number of DB schemes considering a pension increase exchange (PIE) offering and giving members more choices about their pensions.
The number of trustees saying their scheme was considering this jumped from 9% in 2020 to 49% this year, with consideration of partial transfer offerings increasing from 9% to 42%.
Hymans Robertson said that this further highlights the view that retirement options must be diverse, as individuals have different circumstances, and that trustees must ensure there is no longer a one-size-fits-all approach.
“The desire to offer members greater choice within their DB scheme by offering PIE and partial transfers is hugely encouraging,” Markham continued. “It is vital, however, that actions speak louder than words.
“They must offer genuine support far beyond the short-term promise to make sure members are guided to choose the best investment outcomes. They must also ensure the safety of their members savings by offering advice on how to protect themselves from unscrupulous scammers who may be preying on them.
“Member engagement combined with valuable choice leads to better decision making and outcomes for members, and in tandem, reduces the risk to the scheme leading to better outcomes for all.”
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Author: Chris Seekings