16th June 2014

Aegon outlines pricing plans to provide businesses with DWP compliant solutions

Aegon has announced its pricing plans to support employers in achieving compliance with the new charge restrictions introduced by the Department for Work and Pensions (DWP).

Having successfully supported 1,000 employers so far through auto-enrolment, Aegon is well prepared to provide the support to help employers also achieve DWP charges compliance.

These changes follow the announcement from Aegon in April 2014 to apply the 0.75% charge cap to all new entrants for schemes that stage from September 2014 onwards, in line with the DWP announcement on charge caps.

Angela Seymour-Jackson, Managing Director, Workplace Solutions at Aegon UK said: “We’ve already demonstrated our capability and capacity to deliver auto-enrolment, and this experience enables us to help our advisers, employers and schemes implement the latest DWP requirements. Auto-enrolment has given us the opportunity to work with employers and advisers to make the successful transition, and the latest DWP changes will strengthen these relationships further.”

Aegon will work with employers and advisers to implement changes which provide DWP compliant solutions ahead of the appropriate deadlines.

Following a recent review of workplace schemes, Aegon will introduce some changes to its pricing proposition.

• Pricing

As a minimum, Aegon will match the current active price on the majority of schemes with Active Member Discounts (AMDs). For a small number of schemes, this will require the introduction of a monthly employee fee.

For employers who have staged before April 2015, the changes will apply to both new and existing members within the timeframe laid out by the DWP.

For employers with a staging date from April 2015, these changes will apply to both new and existing members, from the staging date.

Aegon is in the early stage of plans to introduce an employer charge, where appropriate, for some services.

• Commission

Aegon will continue to pay renewal commission until April 2016 for employers who have staged before April 2015, at a level which reflects the revised pricing for that scheme. All other commissions for these schemes will be removed at the point the pricing changes are implemented.

For employers with a staging date from April 2015, all commissions will continue until the staging date and will be removed at that point.

A key part of Aegon’s approach to help employers achieve DWP compliance is the transfer of some schemes to Workplace Aegon Retirement Choices (WPARC), Aegon’s award-winning platform.

Seymour-Jackson continued: “Following the review of our existing pension schemes we can now confidently work with employers and advisers to transition to DWP compliant terms ahead of the deadlines. We will achieve this by helping employers engage with their employees for the smoothest transition and an outcome that is in their best interests and providing a proposition that both employers and employees will value.”

Aegon has supported 1,000 schemes on their auto-enrolment journey since October 2012, 80 per cent of this in 2014. This was aided by the use of SmartEnrol, an online hub for managing auto-enrolment, which categorises employees and sends them the appropriate communications at the right time, as well as helping employers to stay compliant and meet their auto-enrolment duties.

Pensions, Retirement