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ScotEq slashes pension commission

Scottish Equitable is the latest provider to slash commission on its group personal pension and group stakeholder business.

The changes, which take effect from January 31, will see standard commission on regular-premium contracts with a 1 per cent ann-ual management charge reduce from 25 per cent to 18 per cent of a first year’s premium.

Schemes with more than 50 members will be priced on a bespoke basis while schemes with 50 members or less will continue to be offered standard terms.

Commission on singlepremium and transfer business is unaffected, as is IFA remuneration on increments and new entrants to existing group schemes.

This brings ScotEq’s group pension commission structure broadly in line with rivals Standard Life and Norwich Union.

Intelligent Pensions technical manager David Trenner says commission levels have typically held up better on group business than on individual policies, with the latter a more fervent battleground in the hunt for new business.

“Some providers on the group side such as Scottish Life believe they can buy market share through paying high commission but Scottish Equitable obviously do not feel the need to.”

Scottish Equitable managing director of group pensions Malcolm Flanders says: “All providers are now realising they must focus on the value of new business as well as providing the right service for advisers.”

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