Section 32 problems gmp and aviva

djcanderson

I am wondering if anyone can help or advise on my problem. I have a section 32 with aviva (norwich union) going back to 87 with a normal retirement date 5/11/52 when I am 62. The problem is the cost of securing the gmp is greater than the sum available so according to them I have to wait until 65.
The gmp amount is £3632. The sum assured £31003 and regular bonus £22611 I have in writing. The final bonus is £14726 I have been told on the phone.
My health is bad and forced me to retire a few years ago and although I don't want to be morbid another 3 years just might be too late to see any benefit.
I would prefer to take what income I could now but according to the blurb from Aviva I can't transfer to a PPP or Comp.
Any help or ideas appreciated the IFA I spoke to seemed to think I was stuck with it.

[Deleted User]

djcanderson wrote: »

I am wondering if anyone can help or advise on my problem. I have a section 32 with aviva (norwich union) going back to 87 with a normal retirement date 5/11/52 when I am 62. The problem is the cost of securing the gmp is greater than the sum available so according to them I have to wait until 65.
The gmp amount is £3632. The sum assured £31003 and regular bonus £22611 I have in writing. The final bonus is £14726 I have been told on the phone.
My health is bad and forced me to retire a few years ago and although I don't want to be morbid another 3 years just might be too late to see any benefit.
I would prefer to take what income I could now but according to the blurb from Aviva I can't transfer to a PPP or Comp.
Any help or ideas appreciated the IFA I spoke to seemed to think I was stuck with it.

Hi Djcanderson,

I'd like to help by taking the details and liaising with our Life and Pensions team here for you.

If you'd like to email me at social@aviva.co.uk with the following details, I'll get an update to you as soon as possible:

• Your full name
• Date of birth
• Postcode
• Any plan reference numbers you have
• Your MSE username so I can link your email to this thread

I look forward to hearing from you.

Kind regards,

Marv
Aviva Social Media Support

Your_Hero

djcanderson wrote: »

I am wondering if anyone can help or advise on my problem. I have a section 32 with aviva (norwich union) going back to 87 with a normal retirement date 5/11/52 when I am 62. The problem is the cost of securing the gmp is greater than the sum available so according to them I have to wait until 65.

This is correct,

The gmp amount is £3632. The sum assured £31003 and regular bonus £22611 I have in writing. The final bonus is £14726 I have been told on the phone.

The final bonus is not guaranteed and can change by the time you draw benefits.

I would prefer to take what income I could now but according to the blurb from Aviva I can't transfer to a PPP or Comp.
Any help or ideas appreciated the IFA I spoke to seemed to think I was stuck with it.

This is also true. As the transfer value is lower than the cost of the GMP, Aviva cannot allow you to transfer this out to a PP (they will be breaking the law under S20 of the Pension Schemes Act 1993). They are forced to keep it on their books so that they can fulfil their statutory duty of meeting the GMP.

xylophone

http://forums.moneysavingexpert.com/showthread.php?t=4931511&page=2

this thread might be worth a look.

djcanderson

Thanks xylophone the IFA seems to be clued up on section 32's that might help.
It really amazes me that the government FSA etc keep telling people to get open market quotations to get the best value they can from their pension. Now the government intends letting folk take their benefits in cash but in my case I am meant to accept what Aviva give me when they decide to pay it to me---seems an unfair world!

dunstonh

It really amazes me that the government FSA etc keep telling people to get open market quotations to get the best value they can from their pension.

That is correct. You either end up with something better or knowledge that you have got the best. Plans with guarantees are in the minority.

Now the government intends letting folk take their benefits in cash but in my case I am meant to accept what Aviva give me when they decide to pay it to me---seems an unfair world!

You dont have to accept it. However, the value is likely in your guarantee and not in a cash value.

djcanderson

dunstonh wrote: »

That is correct. You either end up with something better or knowledge that you have got the best. Plans with guarantees are in the minority.
I honestly believe with my health problems if I could go open market I would be able to collect my pension now at the date it was set up for and without having to wait another 3 years £60000+ for a single life level term



You dont have to accept it. However, the value is likely in your guarantee and not in a cash value.

I honestly believe with my health problems if I could go open market I would be able to collect my pension now at the date it was set up for and without having to wait another 3 years £60000+ for a single life level term
It doesn't seem to matter if I accept it or not they won't let me transfer it :sad:

BobTheBuilder1

djcanderson wrote: »

I am wondering if anyone can help or advise on my problem. I have a section 32 with aviva (norwich union) going back to 87 with a normal retirement date 5/11/52 when I am 62. The problem is the cost of securing the gmp is greater than the sum available so according to them I have to wait until 65.
The gmp amount is £3632. The sum assured £31003 and regular bonus £22611 I have in writing. The final bonus is £14726 I have been told on the phone.
My health is bad and forced me to retire a few years ago and although I don't want to be morbid another 3 years just might be too late to see any benefit.
I would prefer to take what income I could now but according to the blurb from Aviva I can't transfer to a PPP or Comp.
Any help or ideas appreciated the IFA I spoke to seemed to think I was stuck with it.

I had a section 32 with NPI and my contracted retirement age[male] was 60 March 2014,there was nothing in my policy docs to suggest otherwise,and every yearly statement i received from them since 1987 stated i would be entitled to my Guaranteed minimum pension at my chosen retirement age of 60,until i was 6 months from this retirement date when they sent me a 1 paragraphed letter saying sorry but you will not be getting anything until state pension age 65.So as i also have health problems and had based my retirement on the age of 60 i found a good IFA who transferred my funds into an immediate vesting personal pension plan,where i received my 25% tax free lump sum and a yearly pension,but in order to achieve this goal i had to give up all the guarantees under the section 32 policy.
So you can transfer the funds,but not the guarantees associated with the section 32 policy.I actually ended up with approx £29 a week less than if i had waited another 5 years for the section 32 to mature,but i also received the tax free lump sum which according to NPI i would not have got at age 65 as they would be forced to finance the guarantees from their funds.
It seemed to me that these insurance companies do not want you to move the funds away from them,as my company did all they could legally do to delay the transfer.I have a thread on here about this.
I am now on the 1st tier complaint mode to NPI as i believe i was misled for over 24 years,i do not think anything will come of it but seeing the complaint through to the end will give me the satisfaction of knowing it will have cost them minimum £500 in admin costs with the possibility of a few hundred in compensation.

Regards

djcanderson

Thanks Bob glad you managed to get something out of them I would be very happy to take that deal myself if I could get it. From what I have been reading some companies are easier to deal with than others although the law Aviva quote surely is the same all round.
Be keen for a recommendation of a good IFA though

atush

And did you speak with the aviva rep who offered to help you?

Your_Hero

djcanderson wrote: »

Thanks Bob glad you managed to get something out of them I would be very happy to take that deal myself if I could get it. From what I have been reading some companies are easier to deal with than others although the law Aviva quote surely is the same all round.

What did the above Aviva company rep say when they looked into your policy?