Pension companies receive 230,000 calls in four days
Following the pensions freedom day last Monday, there was a surge in inbound calls to pension companies to the tune of 230,000; an increase of 214% according to the Association of British Insurers.
The new pension freedoms now in power allow anyone aged 55 and over to access their pension pot in the way that they want to including withdrawing the entire lot as a lump sum.
There were major criticisms before the implementation of the new regulations including the lack of readiness of the government's advice service "Pension Wise" and also how unprepared pension providers themselves may be when the legislation is changed.
There were also calls to ensure that people who withdrew their pensions also sought advice prior to making any decisions. Many people even found it difficult actually accessing their money as some pension providers didn't provide this service.
As you can imagine, all of this coupled with the desire to withdraw, reinvest or simply find out what options were available to those aged 55 and over, call volumes were inevitably going to increase.
There were also more than 10,000 written and email requests received each day to pension providers asking for advice and information. Another number that surely could rise.
The calls and requests for information have been to do with advice and this is where the government backed service; Pension Wise; has been helping out. They are taking bookings for 45-minute appointments to help people make a decision over what they should do with their pension saving, whether it is a good idea to take it all out or whether an annuity is the best option for them.
This surge also goes to show the continued strain on the pensions industry since the introduction of auto enrolment. The so called "Capacity Crunch" is now being seen more than ever with pension companies struggling to deal with the volume of calls from people who are wondering what to do with their pensions as well as those small and micro businesses ringing up regarding auto enrolment.
With 46,300 businesses set to stage in 2015 alone (with this number set to increase exponentially through 2016 and 2017) and around an extra 320,000 people retiring each year, the strain is only going to increase on the pensions industry and the crunch on capacity, is only going to get tighter.
With auto enrolment, knowledge is most definitely key. It is extremely important to consider that you will become the source of knowledge for your employees when you reach your staging date and they will look to you for answers.
IRIS Auto Enrolment Training is a great resource for you to attend either in person via seminar or via an online webinar. 91% of those attending IRIS Training said they would recommend to a friend or colleague.