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- Members are driven to Default Funds by poor scheme practice warns JLT
Members are driven to Default Funds by poor scheme
practice warns JLT
1st February 2012, London: Around 90% of company pension scheme members are trapped 'default' investment funds. Results from the most recent JLT 250 Club* research, shows that improving member outcomes from fund choices requires better scheme practices: -
- 80% of respondents felt there needed to be a significant or very significant improvement in education around investment choices,
- 70% of respondents felt there needed to be a significant or very significant improvement in the language and definition of risk,
- 58% of respondents felt there should be a significant or very significant utilisation of technology to support members,
- And finally 67% of respondents felt there was a significant or very significant need for more 'active governance'.
Duncan Howorth, CEO, JLT Benefit Solutions Ltd (JLT) says "These figures really do speak for themselves, whilst it can be said that pension scheme members are ending up in 'default funds' because of inertia, in reality schemes are not doing enough to help members make important decisions around investments. A lack of education, poor governance, impenetrable language and the bad use of technology are all working against improving member outcomes. Further, persistency of saving is key to strong member outcomes; a key risk to persistency is shocks from investment performance."
"JLT is committed to helping schemes and members improve investment fund decisions whilst the figure may not change materially, it is important that members are making informed decisions and not just acting with inertia."
--ENDS--
Enquiries:
JLT Group Corporate Communications JLT Benefit Solutions
Isabella Young Simon Hazeldine
+44 (0)20 7558 3387 +44 (0)1727 775 102
Editor's Notes:
*The 'JLT 250 Club' is a consumer group of 250 leading companies who have agreed to take part in short surveys within a tight timescale in return for various benefits, including analysed results of the surveys and input into survey topics. The surveys are undertaken in association with YouGov.
Copies of the fill report are available from Simon Hazeldine, JLT Benefit Solutions.
Contact Simon Hazeldine (01727 775102).
About JLT Benefit Solutions Limited
JLT Benefit Solutions Limited (JLT) is one of the UK's leading employee benefit providers offering a wide range of benefit and pension services, including administration, actuarial and pension consultancy, investment, wealth management, Self Invested Personal Pensions (SIPPs), Small Self Administered Schemes (SSASs) flexible benefits, healthcare, benefit communication and financial education.
Authorised and regulated by the Financial Services Authority, JLT employs over 1,300 professionals in the UK with revenues of some £132m in 2010. The acquisitions of HSBC Actuaries and Consultants Limited and iimia Wealth Management have supported JLT's continued expansion to become one of the four largest employee benefits consultancies in the UK. JLT was awarded Pension Scheme Administrator of the Year at the 2010 European Pensions Awards and won the Engaged Investor's Most Innovative Pension Consultancy Award in July 2011.
Other pensions and employee benefits companies within the JLT group of companies include: Profund Solutions Limited, Independent Trustee Services Limited and JLT Pension Capital Strategies Limited.
JLT Benefit Solutions Ltd is part of Jardine Lloyd Thompson Group plc.
http://www.jltgroup.com/employee-benefits/
Jardine Lloyd Thompson Group plc
Jardine Lloyd Thompson Group plc (JLT) is an international group of risk specialists and employee benefits consultants and one of the largest companies of its type in the world. JLT offers a distinctive choice to clients and partners through our combination of independence, scale and specialism.
The Jardine Lloyd Thompson group is quoted on the London Stock Exchange and employs over 6500 people worldwide and through the JLT International Network provides services in more than 130 countries.
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