LONDON 17 September 2015 – Aon Hewitt, the global talent, retirement and health solutions business of Aon plc (NYSE:AON), has announced the results of a survey which showed that 80% of defined benefit (DB) pension schemes have amended their retirement processes as a result of the new Pensions Freedoms.

The survey which was conducted this summer with over 200 DB schemes, asked them how they had responded to the Pensions Freedoms that were announced in the 2014 Budget and which came into effect in April this year.

Key findings included:
•    Over 80% of schemes have taken some action to amend processes and communications in light of the new flexibility.  
•    Around a third of schemes are now quoting transfer values (CETVs) in retirement packs, with a further 20% likely to follow suit shortly.
•    40% of the schemes quoting CETVs are also providing members with some access to independent financial advice so members can make informed decisions on the options available.

Ben Roe, partner and head of Liability Management at Aon Hewitt, said:
“As was expected, it is the larger pension schemes of over £500 million in assets – and with resources to match – that have led the way in making changes. So far smaller schemes have generally not made significant changes with most simply choosing to include generic wording on the new flexibilities within regular newsletters and retirement packs. 

“Even so, the responses vary. Large schemes have generally been at the forefront of introducing risk reduction measures so not surprisingly they have also led on making changes in response to the Budget, as more than a third are planning to quote transfers in the retirement pack. This in turn can lead to significant savings against funding and long-term targets. There is evidence that some companies are also taking advance credit for likely liability gains in their P&L.”

The survey findings show that less than 10% of schemes are making any additional support available to members at retirement. 

Ben Roe said:
“What is disappointing is the relatively low numbers of schemes which are offering meaningful support to members on what is now a more complex decision for them. Not only does additional support lead to better member decisions but our statistics show that this also leads to more members taking a transfer, which ultimately means more cost and risk reduction for companies.

ENDS

Notes to Editors

About Aon
Aon plc (NYSE:AON) is a leading global provider of risk management, insurance brokerage and 
reinsurance brokerage, and human resources solutions and outsourcing services. Through its more 
than 69,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via 
innovative risk and people solutions. For further information on our capabilities and to learn how we 
empower results for clients, please visit: http://aon.mediaroom.com/

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