LV= has announced plans to introduce a new charging structure for pensions taken out from July 2020 in an effort to simplify its fee system following a market review and research with financial advisers.

Policyholders will pay a wrapper fee on the first £700,000 of their pension investments, with no charges being applying to excess sums over this level and a minimum wrapper charge of £195 being introduced.

The provider said its Flexible Transition Account would be built of three simple structural components allowing advisers to mix and match investments to meet their clients’ needs.

LV= Core, which the provider said was the foundation of its pension offering, will have charges of 0.2 per cent for amounts up to £700,000 and 0 per cent for amounts above £700,000.

LV= Selected includes eight discretionary fund managers (DFMs) and approved TIPs for bespoke investment choices, with charges sitting at 0.25 per cent for amounts up to £700,000 and no charge above this figure.

The LV= Extended component offers further additional DFMs and commercial property with charges of 0.3 per cent up to £700,000 and no charges on funds above £700,000.

Clive Bolton, managing director at LV= Savings and Retirement, said: “These changes are another example of how LV= is evolving to support our customers with value for money charges that enable them to mix and match their investments.

“We have done a huge amount of work refreshing our pension range to make it more appealing to advisers and their clients. We have extended our online valuation service, removed the drawdown fee for new customers and these latest changes make LV= more competitive, particularly for those with pension funds between £100,000 and £500,000.”

He added that the provider would be “introducing a series of improvements” throughout the remainder of the year as it seeks to “to develop our range of pensions, investments and retirement products for this customer segment”.

Reports in June from Sky News suggested that LV= was considering the sale of its pensions and life insurance business units following 177 years of independence.

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