New code of practice 'will tighten security' of pension schemes
30/06/2009
Topic: Insurance & protection, Investments, Law and regulation, Market conditions, Pensions, Thinking ahead about retirement
New guidance is set to be offered to pension fund managers looking to transfer pensions risk to insurers.
In a move that is expected to tighten the security enjoyed by people paying into pension schemes, the Pensions Regulator's Buy-ins and Partial Buy-outs toolkit is designed to outline how pension risks can be safely transferred.
A new code of practice launched by the regulator also aims to protect fund members by allowing it to prevent any transfers that it feels are being made to inappropriate vehicles.
Bill Galvin, Executive Director for Strategic Development at the Pensions Regulator, said it is vital pension scheme members are aware of how their investments are being managed.
He added: "At all times, where the risk is transferred to another entity, trustees must be certain that there is no reduction in member security.
"Where the risk is transferred to the individual member, trustees must take all reasonable steps to ensure members understand the risk they are being asked to take on."
The Trades Union Congress has welcomed the new code of practice, suggesting it will give pension scheme members more peace of mind.
In a move that is expected to tighten the security enjoyed by people paying into pension schemes, the Pensions Regulator's Buy-ins and Partial Buy-outs toolkit is designed to outline how pension risks can be safely transferred.
A new code of practice launched by the regulator also aims to protect fund members by allowing it to prevent any transfers that it feels are being made to inappropriate vehicles.
Bill Galvin, Executive Director for Strategic Development at the Pensions Regulator, said it is vital pension scheme members are aware of how their investments are being managed.
He added: "At all times, where the risk is transferred to another entity, trustees must be certain that there is no reduction in member security.
"Where the risk is transferred to the individual member, trustees must take all reasonable steps to ensure members understand the risk they are being asked to take on."
The Trades Union Congress has welcomed the new code of practice, suggesting it will give pension scheme members more peace of mind.
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