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Advisers say L&G charge cap wording is confusing

Legal & General has been attacked by advisers for describing the charges on a personal pension as coming under the stakeholder charge cap.

CBK principal Peter Chadborn says the terminology could confuse customers.

L&G bases the annual management charge on its per- sonal pension on the stake- holder charge cap but wrote to a client warning that any deductions for guarantees or options on their with-pro- fits pension would be indep- endent of the “stakeholder charge cap”.

Chadborn says: “I think that product providers have to be very careful when they use words such as guarantee and stakeholder. As we have seen, this has the potential to be very confusing for a client.”

L&G head of retirement product development Andy Agar says: “I can understand what is being said but we dec-ided that the phrasing ‘stakeholder charge cap’ best described the guarantee.”

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