Why would a broker offer a deal specifically on transferring FROM Standard Life

B

Banquo

Registered User
Messages
217
A well known/regarded FA has the below offering on an execution only basis.
While switcher deals are reasonably common I've yet to see one till today that's is specific to the originating pension provider..

"Value Alert - Execution Only Pensions

For the months of May and June we will offer an AMC of between 0.45% and 0.55% (8 Blackrock Funds) for any transfer from a Standard Life pension"

Any thoughts on the rationale for limiting this to SL pensions ?
 
Is this the offering?

Execution Only ARF

Execution Only ARF, PRSA, PRB. Passive Investment Funds. Global Index Tracking Funds.
www.execution-only.ie www.execution-only.ie

I gather Standard Life offer a 50bps rebate on their 90bps AMC once the value of a PRSA exceeds €100k, without any other intermediary costs.

So, I guess you would be relying on the discretionary value share rebate for this Royal London offering to make sense.
 
That's it.
Sarenco said:
I gather Standard Life offer a 50bps rebate on their 90bps AMC once the value of a PRSA exceeds €100k, without any other intermediary costs.
Click to expand...
Well I guess it's targeting those who do have intermediary costs? Is the SL rebate available on execution only deals or must you go through a broker ?
 
I don't understand the above explanations?

Is it possible that the broker has agencies with all the other companies but not Standard Life?

If he has a customer with say Irish Life and he switches them to Royal London, he would lose the Irish Life trail commission. But if he doesn't have a Standard Life agency, he wouldn't be losing anything.
 
Well, Standard Life accept direct clients, whereas Royal London only accept business via intermediaries.
 
Thats probably it Brendan. I don't believe the other responses were necessarily explanations rather musings.

Though to be receiving trail commission indicates an advisory relationship and I think the intermediary provides an execution only service.
 
From Royal London's point of view, would I really want this business? If it has been proactively switched to me via a broker from another company, would it not likely move again in a year or two? Maybe the commission structure means that they won't lose anything if the punter switches.
 
How does encouraging switching fit into the execution-only model.

If I ring them and ask about the implications for fees and early switching, they have to say "Sorry we can't advise. If you want to switch from Standard Life to Royal London, we can do that for you."

The whole thing just seems really odd.
 
My understanding is that execution only means "no advice" but that doesn't mean "no information at all". I believe that the EO broker will set out the before and after charges and the fund options available and the customer can make a decision based on that? This may not be suitable for a customer who needs more hand holding, explanations, and comparative analysis of different options.
 
My guess is a lot simpler. The offering is fairly generic

Standard Life don't have group pension schemes. So none of the transfers from Standard Life will need to have a Comparison of benefits certificate. if it is an EPP, they can wind down the scheme. If it's a personal pension or PRSA, the COB isn't needed anyway. An offer to transfer from another provider runs the risk that a COB will be completed, which isn't the model that is being followed.

It is a guess though but it is the only reason why I can think one company is singled out.
 
Steven Barrett said:
Standard Life don't have group pension schemes. So none of the transfers from Standard Life will need to have a Comparison of benefits certificate. if it is an EPP, they can wind down the scheme. If it's a personal pension or PRSA, the COB isn't needed anyway. An offer to transfer from another provider runs the risk that a COB will be completed, which isn't the model that is being followed.
Click to expand...
But isn't the offer only for "personal" pensions anyway?

Execution Only ARF

Execution Only ARF, PRSA, PRB. Passive Investment Funds. Global Index Tracking Funds.
www.execution-only.ie www.execution-only.ie
  • Minimum Term to Retirement Age (PRSAs , RACs and PRBs) - 5/8 years
  • ARFs - maximum age 75
Click to expand...
 
A personal pension is an RAC. A PRSA could be company. A PRB is a company related pension.

It's a guess. I have no idea why he would target them otherwise, especially when other providers have must higher charging contracts than them. And they're the smallest provider out of all the others, so you're fishing in the smallest pool too.
 
Steven Barrett said:
A personal pension is an RAC. A PRSA could be company. A PRB is a company related pension.
Click to expand...
Ok, I always assumed that all of these are in the individual's name so are "personal" pensions. I mean, the word "personal" is literally in the PRSA and PRB names but not in the one, RAC, that seemingly actually is personal. As ever, pensions are (unnecessarily) confusing... :(
 
I just assumed it would be a simple way to target the right audience. Who would be more interested in Blackrock trackers with no advice than someone in a Vanguard fund?
 
ClubMan said:
Ok, I always assumed that all of these are in the individual's name so are "personal" pensions. I mean, the word "personal" is literally in the PRSA and PRB names but not in the one, RAC, that seemingly actually is personal. As ever, pensions are (unnecessarily) confusing... :(
Click to expand...
I don't know anyone who calls it an RAC. It has always been an personal pension to me.

But yes, it's always confusing. Knowing the differences keeps me in a job! ;)


Fortune said:
I just assumed it would be a simple way to target the right audience. Who would be more interested in Blackrock trackers with no advice than someone in a Vanguard fund?
Click to expand...
The funds aren't like for like. From what I can see, they track slightly different indices but not enough detail is disclosed to be sure.

And all life companies have a range of index funds.
 
The global equity index funds from both providers track the MSCI World index - so, no difference there.

Royal London has given a value share discount of 0.13% in recent years. Obviously that’s not guaranteed going forward but even if it is repeated, an AMC of 0.55% with Royal London still won’t trump Standard Life’s (effective) 0.4% AMC.
 
You must log in or register to reply here.
Back
Top