Pension sharing on divorce - summary of survey results
28 July 2023
The PLSA conducted a survey between April and May of this year to solicit industry feedback on our current recommended scale of charges, which is used by private sector occupational pension schemes that provide information to members on pension-sharing orders.
The guidance has become a widely used benchmark, though the PLSA plans to update this guidance following feedback from the survey and given the increases to administrative costs and the rise in inflation since the first guidance was released.
Download the survey results
The PLSA is working to update the guidance considering this feedback, which we plan to release this September. Please contact Krista D’Alessandro or Nicky Day with questions:
[email protected] | [email protected]
Summary of Survey Results
Use of the Guidance
Two-thirds of the 75 survey respondents say they have used the PLSA’s pension sharing guidance, with most saying they have used the guidance to determine charges for processing a pension sharing order for a DB external transfer (90%). Most have also used the guidance to determine charges for valuing member’s rights (80%) or for processing a pension sharing order for a pension that is already in payment (80%). Fewer have used the guidance for determining charges for processing an internal pension sharing order either for a DB scheme (47%) or DC scheme (39%).
Charges for Cash Equivalent Transfer Values (CETV)
To produce a Cash Equivalent Transfer Value (CETV) quotation for an active or deferred pension, most (66%) charge less than £600, with a third either charging nothing or less than £249 (34%) – in line with the current PLSA guidance. However, two in five currently charge more than the PLSA guidance, with a third (32%), charging between £250 and £600. Five per cent charge between £601 and £1,000 and three per cent charging more than £1,000. Notably, a number currently do not charge for the first quote and then charge for subsequent quotes.
Charges for Responding to a DC Pension Sharing Request
Two-thirds of those representing DC schemes say they charge up to £249 for a DC request (62%), with 9% saying they don’t charge. However, one in five (22%) charge more than £250 with three per cent saying they charge between £1,300 and £1,849 for a DC request.
Charges for Responding to a DB Pension Sharing Request
Half of those representing DB schemes say they charge up to £249 for a DB request (46%), with 6% saying they don’t charge. However, three in ten (29%) charge more than £250 with four per cent saying they charge between £2,500 and £3,000 for a DB request.
Other Typical Charges
When prompted, most respondents say they charge the same as the range suggested for producing a CETV quotation (67%), provision of other information (63%), processing a pension sharing order for an external DB scheme transfer (60%).
However, more than a quarter (28%) say they charge less than the range suggested for producing a CETV quotation for a pension in payment, while a third (32%) say they charge more than the range suggested for processing a pension sharing order when pension already in payment.
Download the survey results
Download the current recommended scale of charges