Broadstone has launched a new service, Broadstone CARE, to help trustees and sponsors of defined benefit (DB) schemes that remain in legacy insured contracts to evaluate their options and maximise value.

DB pension schemes often hold historic group contracts with insurers, but changes in regulation and financial conditions have led providers to scale back services, outsource functions or exit the market.

This has typically left trustees and sponsors managing complex legacy arrangements with unusual benefits, guarantees, investment structures and charges that are often costly and difficult to administer or unwind.

According to the firm, Broadstone CARE offers a four-stage framework to help schemes review their position, with the aim of supporting decisions on whether to retain or exit existing contracts.

Commenting on the new service, Broadstone head of trustee services, Chris Rice, said: “Legacy insured contracts were a great idea when they were initially set up, providing a ‘one stop shop’ for all services and including valuable investment guarantees.

“However, the evolving regulatory environment and financial conditions have caused insurers to look at ways of reducing their exposure to these contracts, encouraging exit, outsourcing, removal of services, or even withdrawing from the market entirely.”

Rice added: “It is important that these schemes receive the necessary, specialist advice to maximise value from either running or exiting the contract and receiving services from a dedicated and attentive team of experts.”

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