Company transferring it pension responsibility

Cosimo1964

Due to my work history I have several different pensions via different employers. One of the employers has opted to transfer its pension scheme to a third party, a specialist insurer PIC. According to the documentation I will become a PIC policyholder. It seems odd to me that a company can pass on its pension responsibilities. Has anyone else experienced this scenario?

molerat

Quite a common occurrence. My DB scheme did this and I receive exactly the same pension with the same contractual increases each year as I did when there was a different name on the payment.

Woodstok2000

Aaccording to their website, about 430,000 people have experienced this with PIC.

Marcon

It's become increasingly common for schemes which are closed to new members/future accrual of benefits to opt for what is known as a 'buy out'. It can feel alarming if you've never come across the scenario before (and many people haven't), but it's actually very good news. Your benefits will be those to which you were entitled under the rules of the original scheme. Once the buy out has concluded, your pension has 100% protection under the Financial Services Compensation Scheme with no upper limit - so there is no longer any need to worry about the original sponsoring employer of the scheme going to the wall with the scheme in deficit.

It's normally a two-stage process, with a 'buy in' preceding a buy out. If this is the first you've heard of it, then you are likely to be at the buy in stage (or didn't receive/read previous correspondence from the trustees!).

At the buy in stage, the trustees of the scheme continue to be responsible for administering the scheme and paying pensions as they fall due until the final buy out contract is signed, when all responsibility passes to the new provider.