Aviva is in talks with LinkedIn about a partnership that could help millions of savers to locate forgotten pension pots.
Chris Wei, global chairman of Aviva UK digital, said that in 2017 “we’d like to partner with LinkedIn to create a scheme which could be called the UK’s biggest treasure hunt”.
The British insurer is piloting schemes with the online networking website and other companies with large numbers of digital users to create an easy way for people to trace pensions that they have built up with previous employers.
Almost one in eight people have at least one pension that they have lost track of, equal to 2.5 million pension policies, Aviva found from a survey last month of 10,000 people.
The difficulties are pronounced for former employees of companies that change their name or are taken over, or if the individuals themselves switch job several times or move to new addresses and so no longer receive information about old pension plans.
According to government figures, there is an estimated £400 million in unclaimed pension savings nationally. People will have an average of 11 different jobs in their lifetimes, which could mean that they have 11 different pension pots, the government has found. Failing to tap unused money is particularly serious as almost three in five adults are worried about not having enough to last them in retirement, the Aviva research found.
£400m: Annual unclaimed pensions savings
Insurers continue to manage orphan pension pots but cannot distribute them. They may also subject them to charges and invest them in ways that are not suited to policyholders’ changing needs.
The pensions industry is working with the government to address the problem, which will involve creating a “pensions dashboard”. This will be an online service that will allow people to log on and see all of their pension savings together in a single place.
The idea is a simple one but industry experts are struggling to deliver it as it involves designing a system that can confirm a person’s identity, match it against a range of pension pots, including the state pension and defined-benefit as well as defined-contribution schemes, and deliver it back securely in an understandable format.
The Association of British Insurers is working on a prototype system to be created by the spring, with the service being publicly available from 2019.
Aviva’s plan for a private sector tie-up with one of the biggest commercial names on the internet is part of its plan to focus on its digital platform for growth. The insurer, which has 33 million customers, has created a “MyAviva” platform and spent two years making it easier for individuals to log on, see all of their policies in one place and purchase a wide range of products.
Mr Wei said that compared with Aviva’s competitors, “we have made more effort to invest in getting the foundations of our house in order to be a true digital company”.
Source: The Times