The rate of quotation requests for DB transfers has fallen to 1.6 per cent of deferred members in Q3 2018, according to research from LCP.
LCP’s quarterly review of the transfer experience for the schemes it administers found they had fallen from 1.7 per cent in Q2 2018 and from 1.9 per cent in Q3 2017.
However, this is still almost three times as much as the level it was at in 2014, before the introduction of pension freedoms.
Furthermore, the average transfer value has also fallen in Q3 2018. In Q2 2018, the figure stood at £397,000 before falling to £310,000 in Q3 2018.
Around a quarter of the schemes that LCP surveyed included an estimated transfer value in the retirement packs provided to members.
In those schemes, around 16 per cent of members aged over 55 requested transfer values between 1 April 2017 and 31 March 2018, compared to just 12 per cent of members in other schemes.
Additionally, 44 per cent of those quotes from members that received the estimate transfer value were paid, in comparison to 33 per cent in other schemes.
LCP’s research found that “quotation and take up rates continue to be highest for those aged 55 and over”.
“Over 11 per cent of deferred members aged 55 and over requested a transfer value in the year to 30 September 2018, compared to 7% of deferred members as a whole,” the report said.
The report also highlighted the impact that the Lloyds Bank GMP High Court ruling has had on transfer values: “The judgement will have significant implications for most UK DB pension schemes on many fronts, including transfer value payments.”
LCP has advised trustees to consider some immediate actions: “Agree an immediate response with the scheme administrators, consider the legal and tax implications of any proposed actions and review communications and discharge forms.”