Henry Tapper, Ruston Smith, David Slater and Vincent Franklin discuss the ways we can support staff as they move from a workplace pension into a post retirement world

1. Working to deliver
better member
outcomes
August 2019

5. Quietroom 5

6. Quietroom 3
They’re great at customer service

7. What AgeWage sets out to do
To be independent thought leaders
Provide clear and simple scoring
Give clarity on retirement options

8. At the heart of our service is
a bespoke algorithm,
created by an advisory team
of industry experts.
The algorithm is fed by data
on funds and contracts,
measuring the value
achieved and the money
spent on each pot.
The algorithm expresses the
value for money of each
pension pot in a single
number.
Clear scoring

9. Clarity on retirement options

10. Thought leadership – not everyone needs an IFA
You want to wait and see
You want drawdown but
can manage it yourself
You want a certain income
that lasts as long as you do
You want
drawdown and
want an IFA

11. You want drawdown and you want an IFA
• Finding the right IFA(s)
• Reward
• Performance reviews
• Staff/member feedback
We need a
DELEGATED MODEL OF ONGOING OVERSIGHT
-Ruston Smith
.

12. GOOD GOVERNANCE:
MODEL OF DELEGATED OVERSIGHT
OF APPOINTED IFA FIRMS
Ruston SmithLOOKING AFTER EVERDAY PEOPLE – TODAY AND TOMORROW

13. GUIDANCE AND ADVICE:
• There are times during people’s lives when they need guidance or advice about their pensions
• The FCA’s own research has called into question the appropriateness of the advice that some IFAs have provided on,
for example, pension transfers
• Being referred to the unbiased.co.uk website doesn’t guarantee the right advice or the best experience
COMPANIES AND TRUSTEES
• Some Companies and Trustees have appointed or are considering the appointment of a small panel of IFA firms for
their people – to provide some assurance that the firm that is chosen is a trusted one
• A barrier to the appointment of an IFA firm is the risk that they may not remain suitable on an ongoing basis
• Corporates and Trustees may have concerns about the future risk that the IFA firm they’ve appointed fails to deliver
what’s required for members – with unintended consequences for both employees and the company / trustees
• A proposition does not currently exist to meet this need – to monitor appointed IFA firms on an ongoing basis
Everyday People – Financial Advice Challenges on Pensions

14. THE SOLUTION:
• Where corporate sponsors and trustees don’t have the capability and capacity, they delegate to those that do
• The solution is a delegated model of ongoing due diligence and monitoring
• The service would provide independent ‘ongoing’ monitoring and due diligence of the IFA firms that have been appointed
• Quarterly reporting to the corporate and/or trustee board – to provide transparency and robust governance
• The ability to take proactive measures – and early resolutions of any concerns that are found
GETTING THIS RIGHT
• Widely consulted regulators, government department, ombudsman and industry leaders in this space
• Listened to feedback and included suggestions to further strengthen the proposition
• This is ‘work in progress’ but feedback, so far, has been very positive – but there’s more to do
SOLUTION PROVIDER:
• Capable, credible and unconflicted – with capacity
• Market is being developed
PROPOSED SOLUTION

15. Would include the following ‘independent’ checks in the following areas:
THE IFA FIRM:
• FCA registration and compliance
• Change in ownership, business model or structural change – including extensions to the type of advice or service they offer
• Financial position including surplus capital
• Compliance with Statutory Requirements eg Companies House, FCA – and reporting of any sanctions or fines
• Level of Professional Indemnity Insurance and direct accessibility to financial remediation
PEOPLE:
• Training requirements being met
• People changes
ADVICE AND SERVICE:
• Appropriateness of the advice - by checking a fair representation of those that have had advice and the type of advice being
given. Is the right advice being given?
• Visibility on the type of advice, at the firmwide level, being appropriate – eg % recommended to transfer from DB
• Clarity and Simplicity of the advice – by getting feedback from those who’ve had advice. Did they understand what they were
being told so they could make the right choices?
• Complaints by number and type – at the firm level
• Appropriateness of the overall charging and approach on the end to end advice – ie downstream
• Approach to ‘insistent clients’ and ‘contingent charging’ remains unchanged and appropriate
PROPOSED PROPOSITION

16. We see c.105,000 words a day –
Equal to 34GB when you add visuals from
mobiles devices, TV
LOW KNOWLEDGE
Average mortgage holder at age
60 has mortgage debt of
£90,000
CML Mortgage Survey 2016
DISTRACTED BY DEBT
1 in 20 adults
have the literacy or numeracy
levels of a 5 year old
19% of 55 to 65 year old’s have a
literacy (26% numeracy) standard
equivalent to GCSE grade D to G
Supporting everyday people on decisions that will significantly influence their quality of life
1 in 5 don’t understand
their bank statement
Everyday People – Their Challenges, Our Challenges
TOO MUCH INFORMATION
LOW SAVINGS
40% of UK workers
have less than £100 of savings
TIME IS PRECIOUS
Those with children only have
17 minutes to themselves each day

17. Key Messages
1. There’s a need for independent ‘ongoing’ due diligence and reporting for companies and trustees who have
appointed an IFA firm or panel for their employees or members
2. Provides transparency, robust oversight and governance – on an ongoing basis – supplementing FCA supervision
3. Provides assurance that employees and members are receiving good, clear, simple and appropriate advice
4. Facilitates early remediation in areas where employees and members may not have received appropriate advice
5. Improves governance and reduces concerns by Companies and Trustees who consider appointing an IFA panel
Supporting people in making the right choices – improving outcomes for retirement

18. You want drawdown but can manage it yourself
• Help at hand
• MAPS
• Pension Dashboard
• Choice architecture
• Investment pathways

19. You want to wait and see
• You have independent savings
• You worry about long term care
• You are hoping for innovation
• You await inspiration (and CDC!)

20. You want a certain income that lasts as long as you do
• Enhancements
• Shape
• Flexibility
• Open market

21. Introducing the UK’s largest annuity intermediary

22. Pension freedoms
The death of annuities?
“No one will ever have to buy an
annuity again”.

23. Did this spell the
death of annuities?

24. 35,408 New annuity sales
Retirement income - post pension freedoms
Source: FCA’s latest data bulletin – 09/18 and data from LV= and Canada Life
101,000 New drawdown + UFPLS sales 33,975 New annuity sales
but… 60% of new drawdown sales are zero income
46,697 Income drawdown + UFPLS sales 33,975 New annuity sales
but… adjusting for 1,433 fixed term annuity sales (classified as drawdown)...
45,264 Income drawdown + UFPLS sales

25. FTSE 100
6,930
3,436
- 50.4%
6,730
3,512
- 47.8%
7,103
5,536
- 22%

26. Individually personalised underwritten annuity quotations
Enhanced annuities
Annuity quotations based on personal medical and lifestyle information:
Over 80% of Retirement Line enquirers qualify for an
enhanced annuity vs. the national average of circa 60%
Occupation
Postcode Alcohol intakeBMI Smoking
High blood pressure High cholesterolLiving status
In 2018, over 57% of all our sales were enhanced annuities

27. The secret to our enhanced annuity success
Regular medical
underwriting training
Our own bespoke health form
and method of data gathering

28. Enhanced Annuities - medical conditions and potential enhancements
Medical/lifestyle condition Percentage
Increase
Additional annual
income
Total annual
income
Annuity rate
Smoker 12.06% £603 £5,603 5.9%
Heart Attack 47.96% £2,398 £7,398 7.9%
Diabetes 54.44% £2,722 £7,722 8.2%
Chronic obstructive pulmonary disease (COPD) 69.22% £3,461 £8,461 9.0%
Alzheimers 145.86% £7,293 £12,293 13.1%
Source: all enhanced quotes from Retirement Line’s portal for April 2019
Below figures based on an annuitant aged 65 with clean bill of health and standard annuity payment of £5,000pa

29. £4,500 a year x 5 years + £55,527 GMA
Regular income for set term with/without Guaranteed Maturity Amount (GMA)
Withdrawals can be spread during set term to minimise or avoid tax
GMA is without investment risk – can be reinvested at maturity under pension freedoms
Can take tax-free cash without taking any income
Potential for higher income at end of term if future annuity rates increase or health deteriorates
Choice of cost-effective lump sum death benefits
Can transfer out at any time for any reason: eg onset of poor health could qualify for an enhanced annuity
What are they?
Fixed term annuities
£100,000 fund - £25,000 tax-free cash = £75,000 into the annuity
£78,027=
Example: Fixed term annuity over 5 years
YTD, over 40% of all our sales are fixed term annuities

30. Annuity sales post pension freedoms – some concerns
57%
of annuity sales to existing customers
(source: FCA Data Bulletin - 09/18)
39% - 48%
of consumers who bought a standard annuity from
their existing provider may have been eligible to
buy an enhanced annuity
(source: FCA PS 19/1 - 01/19)
70%
of over 55’s unaware of enhanced annuities
(source: Hargreaves Lansdown - 2019)
76%
of over 55’s believe disclosing medical conditions
decreases their annuity rate
(source: Legal & General 2018)

31. Enhanced annuities – provider bias

32. Pension freedoms
Perhaps, this would have been more suitable..
“No one will ever have to buy a POOR annuity
again”.

33. Who are
Retirement Line?

34. Retirement Line – our achievements
Largest introducer of enhanced annuities to Just Group, UK’s leading enhanced annuity provider
Largest introducer of fixed term annuities to Canada Life (2016 - 2018)
Consistently top or second largest introducer of fixed term annuities to LV= (2016 - 2018)
9.9 score out of 10 on Trustpilot - over 1,100 reviews
Appointed annuity broker to BestInvest
Appointed annuity broker to Wesleyan Assurance
Complaints record – only 38 complaints since 2013 whilst arranging circa 20,000 annuities
Since 2018, UK’s largest annuity intermediary by far

35. Retirement Line
UK’s Number 1 annuity intermediary
Period Total number of annuities arranged Total funds transferred
2018
2,924
23% higher than 2nd placed firm (MPE)
£161,000,000
30% higher than 2nd placed firm (LV=)
Q1 2019
766
20% higher than 2nd placed firm (HUB)
£46,000,000
50% higher than 2nd placed firm (HUB)

36. Culture – what the FCA expects
Our culture: we desire all our staff to enjoy working for us
Family-owned business
Negligible staff turnover
Expert and contented staff means happy and satisfied customers
Satisfied customers means successful business
Our staff recognise that our customers are of paramount importance to the success of our business
Andrew Bailey, Chief Executive, FCA (July 2019)
"Culture continues to be an issue of the highest importance for the FCA.
It is a central consideration for our supervisors, who look at drivers of
behaviour, staff incentives and governance arrangements in their day-to-
day interactions with firms.“

37. Annuity partner to Wesleyan Assurance Society
What we give Wesleyan
Award-winning service from an authorised and regulated firm (FCA reference 726601)
Tailored Service Level Agreement
Data security
Pension scam protection
100% call recording and monitoring
Monthly MI and sales results
Peace of mind that their regulatory obligations are being met

38. Annuity partner to Wesleyan Assurance Society
Instant best guaranteed open market annuity quotes from our own portal
All paperwork completed by expert RL staff
Online ‘paperless’ journey
Weekly progress report by email or telephone
First-class customer service designed to avoid stress
No fees nor obligations – we only receive an upfront commission payment if a customer proceeds (no
ongoing fees)
Single sales and admin point of contact
Unlimited annuity quotes and detailed information enabling informed choices
What we give Wesleyan customers

39. Wesleyan tribute
Appointed exclusive annuity parter to Wesleyan Assurance Society
Retirement Line have their customers' very best interests at the heart of all they do and their
front-line team of experienced annuity specialists offer a fabulous empathetic and patient
service.
As we inform our customers on our website: "Our customers are in safe hands with
Retirement Line. Known as 'the best annuity broker on the market'.”
David Nottingham
Head of Product Development & Performance
8th March 2019

40. How we can
help your members

41. Thank You
Any questions?