Axa says the number contracting back in to state second pension is rising despite Government figures that show older workers are still ignoring warnings on contracting out.
Despite insurers efforts encouraging contracting in, according to the Department of Work and Pensions 2004 figures, 20.3m people remain contracted out. Some IFAs are loath to advise either way because of concerns the Government could change pension policy in the future.
Axa head of pensions marketing Steve Folkard says: “Our research shows a significant number of people contracting back in. We have had a slightly stronger response from our direct than our IFA customers, and are planning our next phase. The objective of the exercise was to educate people, not to force their decision.”
The Department for Work and Pensions has recommended men and women over 54 contract in to S2P.
The FSA is also reminding consumers to confirm their S2P status, posting a message on its website asking people to consider whether they are contracting in or out.
Hargreaves Lansdown head of pensions research Tom McPhail says: “Most of the research seems to be in favour of contracting back in, but we feel as a firm of IFAs it would be hazardous to offer advice without guaranteed certainty over the risks.
“As long as the insurance companies have boxed out all the business risk compliantly, theyve minimised their exposure.”