MANAGED PENSION FUND REVIEW

Policyholders with Managed Pension Funds have been sent a questionnaire as part of the ELAS Managed Pension Review. The ELAS Managed Pension Review is to assess whether Managed Pensions were mis-sold. The terms of reference are whether the sale was compliant, i.e. did it conform to the necessary conditions as laid down by the FSA, etc. The letter states that the FSA have instituted a review to ensure that people were sold a product that reflected the degree of risk they were prepared to take. It goes on to say that returning the form does not automatically entitle one to any compensation. 

See Rectification suggestions

The FSA became concerned in 2001 about Managed Pension/Income Drawdown Plans/Pension Fund Withdrawal schemes 

ELAS were responsible for introducing these to the market - originally as the Managed Annuity which was then revised to the Managed Pension form.  

Other companies followed suit - many with high charges. This is what caused the FSA concern - especially when small funds where being converted but with large amounts taken out in commissions and fund charges.

The FSA then wished to review Income Drawdown sales but were unsure if there was wide-spread issues regarding mis-selling or concerns. So - as ELAS had sold more plans than any of the other lifecos - they were asked to review their own sales. The terms of reference where fairly loose - ie ELAS had to police itself to the satisfaction of the FSA. Based on the ELAS findings, the FSA would then decide whether to conduct an industry wide review.

It should be noted that the GAR issue is totally separate and is not part of the Managed Pension/IDP review. An IDP will be looked at just to see whether the original sale was justified based on an individual's circumstances