Our process is designed so that we can work together with you to provide the necessary advice to your client.
- OBTAIN DB ADVICE PACK
Once you identify a client who requires advice on their Defined Benefit pension, you will need to request a DB advice pack from us. This will include our Fact-Find, Risk Questionnaire, and Adviser Recommendation Form.
- FACT-FINDING AND DATA GATHERING
As you have the existing relationship with the client, you will complete the Fact-Find and Risk Questionnaire with them. You will also obtain the full scheme information.
- SUBMIT CASE
Once these documents have been completed, they need to be submitted to us with a copy of the CETV and Client Terms of Business. The non-contingent fee will also need to be paid at this stage by yourself or the client. These documents will be checked by PAS and the case will either be accepted or further details will be requested.
- PAS ANALYSIS
Once the case has been accepted by PAS, we will complete the analysis using the regulator’s Appropriate Pension Transfer Advice (APTA) framework. This includes obtaining a Transfer Value Comparator (TVC), completing LTA calculations, cashflow modeling, and preparing the Suitability Report. Our Pension Transfer Specialist will also speak directly to the client at this stage to add some colour and depth to their objectives and answer any questions the client may have.
- SUITABILITY REPORT and CERTIFICATE OF ADVICE
The Suitability Report will be sent to both you and the client. Once the client has signed the Suitability Report, we will release a Certificate of Advice, providing confirmation that advice has been provided to the scheme member.
- IMPLEMENTATION OF TRANSFER (UK INTRODUCERS ONLY)
We have recently introduced an implementation service to support any Introducers that are unable to, or do not wish to, complete the implementation of the transfer. Once the transfer is complete, the receiving plan is transferred back to the agency of the Introducer. This is only available where PAS recommends that the client transfers their Defined Benefit pension.
INTRODUCER QUESTIONNAIRE AND TERMS OF BUSINESS
Prior to submitting your first case, you will need to complete the on-boarding process with PAS, which includes signing a Terms of Business Agreement and completing an Introducer Questionnaire. This is a one-off process to ensure that we are both happy with the relationship going forward.
You may have your own Fact-Find which you use with clients. However, for any cases submitted to PAS, we require completion of our own PAS Fact-Find, as this will provide all the necessary hard and soft facts that we require to complete our analysis. The PAS Fact-Find is specifically designed to get as much as possible of the information in the client’s own words. This is the best way to identify the ‘true’ objectives of the client and is highly encouraged by the FCA. The Fact-Find will need to be signed by both the client and yourself prior to submission to confirm that it is an accurate reflection of the client circumstances. The Fact-Find also includes a section detailing the risks of a transfer and you will need to discuss this with the client in detail.
Again, you may have you own way of establishing risk, but in order for our advice to be consistent, we require the completion of a PAS Risk Questionnaire, including details of capacity for loss. This is based on the highly regarded Dynamic Planner Risk Questionnaire.
ADVISER RECOMMENDATION FORM
You will need to complete an Adviser Recommendation Form which will detail the product and funds that you are recommending together with the charges associated with this recommendation. This will allow us to assess the suitability of this recommendation in line with the client’s Attitude to Risk.
We use the Selectapension TVC tool to analyse the transfer value being offered. The TVC will show, in graphical form, both the transfer value offered by the scheme, and the estimated ‘risk-free’ cost of replacing the scheme benefits through an insured annuity.
We consider Cashflow Modelling an important part of our analysis, as it assesses sustainability of income in retirement. We will run a model to compare how long the scheme pension can be matched through drawdown (based on a number of assumptions) and we will also run models based on the specific income objectives of the client. For this, we use the CashCalc tool, which is widely acknowledged as one of the best cashflow modelling tools available.
From experience, a Suitability Report can vary in content and length. It is our opinion that the important information within a report can often be lost. We have designed a Suitability Report with the client in mind. We have used client language and visuals where possible to enhance the content and have limited the main part of the report in length, so that it is easy for the client to view their objectives, understand the risks and see what recommendation is being made. Much of the detailed analysis is provided in the appendices of the report.