Around 60 per cent of UK individuals with a defined benefit (DB) pension said they would support their scheme running on to try and generate a surplus through long-term investment risk, research from Hymans Robertson has revealed.

As part of its latest Excellence in Endgames series, its report, The member perspective: Endgame choices through the member lens, revealed that although DB pension scheme members are open to their schemes running on, there were differing opinions on how surplus should be distributed.

Over half (58 per cent) believe surpluses should benefit members directly, 7 per cent said employers should be the sole beneficiary, while 20 per cent think both members and employers should benefit.

Just over a quarter (27 per cent) of respondents believe that surpluses should remain in the scheme to enhance security.

Indeed, the report also found that security is the greatest priority for members, with 67 per cent of respondents identifying it as their top concern regarding their DB pensions.

The research also revealed that trust in the organisation managing their pension was also a priority, with 54 per cent selecting it as a key concern, while flexibility in how benefits are taken (29 per cent) and good customer service and support (21 per cent) were rated lower by respondents on their list of priorities.

The consultancy said the importance placed on security suggests there is a need to help members understand how their benefits will be kept secure and that the choice of endgame strategy plays a central role in providing that security.

When respondents were asked about their DB scheme being transferred to an insurance company, views were mixed, which Hymans Robertson said highlighted a potential knowledge gap.

Under a quarter (23 per cent) said they wouldn’t mind their pension being transferred to an insurer provided it remained secure, while 14 per cent felt their benefits would definitely be more secure with an insurer, reinforcing security as a key priority.

However, 43 per cent of respondents said they were unsure about moving their benefits to an insurer, 12 per cent said it would depend on the insurer, and 31 per cent had concerns such as the loss of flexibility or valuable options, customer service, missing out on pension increases and losing an employer link.

The report went on to ask the 31 per cent of people with concerns, what the main cause of this is, to which 13 per cent said losing some options or flexibility, 7 per cent said customer service from an insurance company and 6 per cent said losing the link to the employer and missing out on bigger pension increases.

Commenting, Hymans Robertson head of member experience for risk transfer, Donna Prince, said these findings reveal that many members could benefit from more clarity on the security provided by insurers.

“Whilst trustees and sponsors receive training and professional advice on the various options available to them, members do not. So, we can’t assume that members understand the protections or benefits offered by options such as insurance or running on,” she said.

Prince added that beyond pricing, the report highlighted that factors such as flexibility, customer service and the overall journey they are on are important to members.

Given this, she suggested trustees should consider this when selecting insurers and navigating their approach and urged them to ensure they carry out appropriate due diligence on the administrative capabilities and the member experience provided by the insurer.

“For schemes running on, it’s important for trustees to maintain a high-quality member experience. To achieve this, they should ensure they have a robust framework and reporting in place to monitor the scheme’s administration services,” she said.

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