A taskforce set up by the Personal Finance Society has published a code of good practice for advisers who specialise in defined benefit transfers.
The adviser code is based on nine principles underpinning good practice when giving pension transfer advice.
These nine principles include helping clients understand when advice is appropriate and ensuring it supports the clients’ overall well-being in the context of their stated objectives
It has been launched in conjunction with a new consumer guide for DB transfers that is meant to help consumers better understand what to expect from regulated financial advice.
The guide will be called the Pension Transfer Gold Standard and advisers who adopt the code will be required to display the Gold Standard badge.
One of the requirements of firms wishing to adopt the Gold Standard is they have professional indemnity insurance which meets FCA threshold conditions.
PFS chief executive Keith Richards says: “In an often-cynical marketplace, perpetuated by a minority who can impact the perception and reputation of the majority, the Pension Transfer Gold Standard is about raising consumer awareness and redressing the knowledge imbalance between firms giving advice and consumers seeking and taking it, especially those who are mandated through pension freedoms.
“It is important that consumers are initially guided to make an informed decision before engaging a financial adviser for the first time, which we believe will also better support financial advisers giving advice.
“Crucially, the Gold Standard will allow advisers to align with initial guidance provided by Pension Wise and included with initial valuations from scheme trustees.
“An adviser or firm that adopts the Gold Standard is demonstrating that they are prepared to go the extra mile in order to foster trust in our profession whilst also addressing the concerns raised by the work and pensions select committee.”
Consumers will be able to identify advice firms that have adopted the standard by visiting the retirement directory on the Money Advice Service website which will be supported by the PFS and incorporated within its own directory.
Money and Pensions Service chief executive John Govett says: “We welcome the Pension Transfer Gold Standard as a great industry initiative designed to help consumers find the specialist advice they need when considering whether to transfer safeguarded pension benefits.
“The Money and Pensions Service supports industry-led schemes that seek to safeguard consumers and we look forward to working with advisers, firms and their professional bodies to ensure that customers feel confident in seeking the help they need.”
Earlier today the guidance body set out its strategy to boost pensions confidence ahead of a UK-wide roadshow.