Up to £20bn worth of pension pots could remain unclaimed, new research from the Pensions Policy Institute (PPI) has found.
The research, which surveyed 50 per cent of the defined contribution pensions market, found 800,000 lost pensions worth an estimated £9.7bn, equating to £13,000 per pot.
The survey, carried out on behalf of the Association of British Insurers (ABI), did not include public sector or trust-based schemes, meaning the figure could be even higher.
ABI director of long-term savings, Yvonne Braun, said: “These findings highlight the jaw-dropping scale of the lost pensions problem. Unclaimed pensions can make a real difference to millions of savers who have simply lost touch with their pension providers.
“The industry has stepped up its efforts to re-connect savers with their lost nest eggs, developing a new framework launched earlier this year to help pension providers trace ‘gone-away’ customers more consistently. But industry efforts can only go so far – we need a radical digital solution to cope with the way society is changing, or the problem will get worse.”
According to the ABI, over 375,000 attempts were made to connect customers with their lost pension pots in 2017, leading to £1bn of assets being reunited.
The government has predicted that there could be up to 50 million dormant and lost pensions by 2050.
The growing problem has led to increased calls for the pensions dashboard, which would allow members to see all their pension savings, including their state pension.
“It is important that the government stands by its promises to take forward the pensions dashboard. This project has cross-party support, with the backing of consumer groups, and could mean a more secure retirement for millions of savers.”