Section 32 pension about to close - what to do?

xylophone

just had telephone conversation with a ‘complaints officer’ in response.

I asked him to summarise his response in writing to me. This is a real grind.

Indeed - they should have responded in writing anyway?

You have carefully checked your original policy?

If you get nowhere, formal complaint, final response and refer to ombudsman on the grounds that

Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.

https://www.pensions-ombudsman.org.uk/

jamesd

That's progress of a sort, saying it's them who are imposing an advice requirement to take a non-safeguarded protected PCLS from a plan that has no safeguarded benefits at all. Beats falsely claiming it's the regulator.

Malthusian

xylophone wrote: »

Indeed - they should have responded in writing anyway?

They have to issue a final written response within eight weeks of receiving the complaint, but there's no reason not to have a phone conversation with the OP in advance of that. Indeed it's good practice as it could resolve the issue quicker (but hasn't in this case).

I agree, a complaint on the grounds of it being an unreasonable barrier is the way to go. There is nothing preventing Aegon from paying out the enhanced TFLS and transferring the rest to another provider other than their own intransigence.

If legacy product restrictions prevent Aegon from doing so without using a new Aegon product - which is still an issue of Aegon's creation - jamesd suggested some perfectly good workarounds.

xylophone

as it could resolve the issue quicker (but hasn't in this case).

An attempt to avoid a clear, written explanation of the policy because it's difficult to defend their stance?

Malthusian

xylophone wrote: »

An attempt to avoid a clear, written explanation of the policy because it's difficult to defend their stance?

Aegon must issue a final response in writing within eight weeks of receipt of the complaint.

Whether that final response includes a clear, written explanation of their policy is up to them. But it would be logical as if their response is "sorry, can't be done", an explanation of why it can't be done is in Aegon's interests because it might convince the client to give up rather than go to the Ombudsman. Even if the explanation is tissue-thin it's more likely to deter the client from taking it to the FOS than no explanation at all.

Having a phone conversation with the client does not imply they are trying to avoid providing a written explanation of anything. It is not in Aegon's interests to do so. The regulations on dealing with formal complaints are such that ringing up the client, attempting to blind them with science, and then hoping they go away is not an option.

The_Doc

@Blackavar: Any update from Aegon?

I am in exactly the same situation with them as I have an S32 that has been transferred in to them from AVCs held in a previous company scheme elsewhere. I have a protected PCLS of around 40% and the fund is in the region of £260K.

I spoke to Aegon agent on the phone today and got the same story as you. I would need to get an IFA to approve of my taking this enhanced PCLS. I was gobsmacked. All I want to do is take the enhanced PCLS and leave the rest invested in the wrapper.

Another frustrated Aegon client.

pauls01

I’m having a similar problem with Scottish Widows regarding my Section 32 pension, which has enhanced tax-free lump sum of 42%, but no other benefits. I seem to have a choice of 2 drawdown products, one will take a charge of 1.77% and the other requires IFA involvement. Seems inconsistent to require an IFA for the 2nd product, but not the 1st; in addition, the 2nd product does not require an IFA for new customers.

Very unhappy with the Customer Service and would ideally transfer elsewhere, but seems I would have to give up the enhanced tax-free element to do this. Rang Hargreaves Lansdown this morning, after reading a suggestion earlier in the thread, but they said I would lose the enhanced element if I transferred to them.

My understanding is that SW will not let me take the enhanced lump sum and then transfer to another provider, unless this is into an annuity.

I am now reaching the point where I will probably just transfer it to another provider, where I have another pension, and forgo the enhanced lump sum. I turn 55 in February and want to take the maximum lump sum to manage lifetime allowance exposure, so time is of the essence for me.

I wondered if anyone had any alternative suggestions?

xylophone

Have you tried a formal, written complaint? Read through the rest of the thread.

pauls01

Thank you. I have written to Scottish Widows, requesting them to waive the IFA requirement and have raised a formal complaint, which I have chased. They say they have up to 8 weeks to respond but have told me informally that the powers that be never agree to that sort of request.

I am considering taking it to the ombudsman after that, but don’t want to delay taking the lump sum in early February.

Ideally, I would like to move the pension now to another provider who would allow me to retain the enhanced entitlement and move into a drawdown product without IFA involvement, if anyone knows of such a provider? In the meantime, I will start calling round providers on Monday - after reading this thread I’ll give Aegon a miss!

wallpaperman

pauls01 wrote: »

Thank you. I have written to Scottish Widows, requesting them to waive the IFA requirement and have raised a formal complaint, which I have chased. They say they have up to 8 weeks to respond but have told me informally that the powers that be never agree to that sort of request.

I am considering taking it to the ombudsman after that, but don’t want to delay taking the lump sum in early February.

Ideally, I would like to move the pension now to another provider who would allow me to retain the enhanced entitlement and move into a drawdown product without IFA involvement, if anyone knows of such a provider? In the meantime, I will start calling round providers on Monday - after reading this thread I’ll give Aegon a miss!

Hi Paul,

I work for a pension provider that has old Section 32's on their books (not any of the companies that you are involved with).

I know from experience that we have transferred members with Protected PCLS to both Transact and Old Mutual Wealth in the recent past, therefore retaining their higher PCLS in the new policy.

I don't know what options become available under these new policies but would guess that there is some sort of flexibility, so might be worth trying either.

I have no knowledge of either company's product, charges or service, or even if they might require a financial adviser to carry out the transfer.