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Employers warned on stakeholder liabilities

Scottish Life says despite the FSA&#39s close scrutiny of IFA group personal pension sales, there may be more potential risks in recommending stakeholder as this could leave employers open to unexpected liabilities.

The issue surrounds employers offering stakeholder access to what the Department for Work and Pensions calls “non-relevant” employees.

If these staff, who do not need be covered by stakeholder, join the scheme and are unhappy for any reason, their employer may be vulnerable to claims for redress and having inappropriately offered stakeholder.

Scottish Life says the dangers to employers of designating stakeholder for non-relevant employees relates to protection given to them by the Welfare Reform and Pensions Act 1999. This in practice makes it safer to recommend GPPs over stakeholder, where the issue of relevance does not apply.

Scottish Life says the area is so unclear that it requires case law to establish to what extent employers are liable.

Head of communications Alasdair Buchanan says: “Before you know if there is definitely no problem with this area, for IFAs, there is the stakeholder route, where the risks are unclear, and the GPP route, where there are no risks of this kind.”


Lynx profits up 20 per cent

Bankhall&#39s parent company Lynx has announced a profit of £11.2 million in the past year, up 20 per cent from its £9.3 million profit in 2000.In its annual results for the year ending September 30 it also confirmed it is in discussions with may lead to an offer for entire company at 120 pence per […]

NPI set off on income drawdown roadshow

NPI is hosting a series of income drawdown seminars for IFAs throughout December to help them keep abreast of what it sees as a growing market.The seminars are designed to explain the product to IFAs who are new to the market and give technical details to those already familiar with drawdown.

IO Investors to target UK IFAs with fund duo

Manager-of-manager provider IO Investors is set to introduce two new unit trusts in April in to the UK IFA market.The South African firm launched in the UK this month under the new brand of IO Investors. Until now, it has run under the Gensec International Asset Management brand.The two new funds – the global balanced […]

Railway society says borrowers still baffled by real cost of loans

Many borrowers are left confused about the true cost of a mortgage when shopping around for the best deal, according to Stafford Railway Building Society.Manager George Robson says borrowers are often bombarded with information on interest rates, discount deals and cashback offers but still have little idea of how much a mortgage will cost them, […]


Guide: what you need to consider for your auto-enrolment project

In this guide, Johnson Fleming reveals what items you need to understand to gauge the impact of auto-enrolment on your business. The guide focuses on: the impact that your auto-enrolment scheme will have on you; assessing your workforce; understanding your staging date; reviewing your current provision; and modelling contribution levels and costs.


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