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Standard Life SIPP ready for protected rights

31 July 2008

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Standard Life has announced it will be ready for business from the 18th August¹ to allow people to transfer and invest their existing protected rights² pension pots into the SIPP, following a change in Government legislation.

This development is the first initiative in a major programme of developments planned for the SIPP over the coming months.

The benefits for clients to add protected rights into SIPP include:

• Introduces additional choice and flexibility when clients need to take retirement income
  
  
• Allows people to invest their protected rights money where they wish rather than being confined to a very limited range of investment options
  
  
• May reduce charges especially where protected rights are currently held in older contracts, or where the addition of protected rights gives a larger fund discount
  
  
• Easier to keep track and monitor fund performance

Advisers can streamline processes and reduce the paper chase for these pots of pension money if clients consolidate. Advisers now have the opportunity to add value and plan with certainty around client reviews knowing that the Standard Life individual, group and Wrap SIPP will be open to protected rights transfer business.

Andrew Tully, Senior Pensions Technical Manager for Standard life commented: "We estimate there is between £75 billion and £100 billion of protected rights funds currently held in defined contribution pension schemes which people might want to consolidate into their SIPP."

Tully concluded: "This is often money which people have forgotten about and therefore is a great opportunity to make this money work as hard as possible for retirement while making investment decisions easier. People can monitor progress of their retirement plans using their SIPP alone and will make life easier by reducing paperwork while maximising the investment potential across their portfolios."

Commenting on the wider programme of SIPP development, Dave Campbell, Director of Retirement Solutions at Standard Life said: "Our SIPP has set the standard for others to follow since launch in 2004, but we can't rest on our laurels. The SIPP market is not a place for the faint-hearted and any company who wishes to be taken seriously needs to innovate to stay ahead. We're confident the developments and support we'll introduce throughout the rest of 2008 will cement our place at the head of this market and make us the natural choice for advisers and customers."

For further information, please contact:

Paul Keeble
Direct 020 7872 4481 / Mobile 0771 248 6387

Notes to Editors

1. New business applications will be available from 18th August 2008, with investments starting from 1st October 2008.
   
   
2. What are protected rights? Protected rights are pension pots which have been built up in private arrangements by consumers who have contracted out of the State Second Pension (S2P). These consumers will have been saving into final salary or money purchase pension schemes and has been possible since 6 April 1978 for final salary schemes and 6 April 1987 for money purchase schemes.
   
   
3. For further details on protected rights please go to the Pensions Advisory Service website: http://www.pensionsadvisoryservice.org.uk/pension_rights/contracting_out/index.asp
   
   
4. Standard Life estimates that there is between £75 billion and £100 billion in protected rights money from defined contribution pension plans which potentially could consolidate into SIPPs.
   
   
5. Standard Life has been voted Best SIPP Provider for three consecutive years by the readers of Financial Adviser magazine, awarded Moneyfacts Best SIPP Provider in 2006 and Moneywise Best Comprehensive SIPP Provider 2007.
   
   
6. Standard Life has distribution agreements for SIPP in place with Barclays, Alexander Forbes, Fidelity, UBS and HSBC.
   
   
7. Standard Life SIPP Background
   
   SIPP is a modern, flexible, innovative pension product, which is attracting investment principally from high net worth individuals who are relatively sophisticated investors. It allows the customer to accumulate a pension fund through regular investing or lump-sum payments and to unlock tax-free lump sums and pension income instead of buying a pension annuity.
   
   SIPP offers a wide range of investment options, including direct investment in specific shares, bonds or commercial property and gives the customer flexibility as to how those investments are managed and how retirement benefits are taken. The Standard Life SIPP also offers an innovative charging structure where many product charges are only incurred if and when the customer chooses specific options. This differentiates the product from other SIPP offerings where charges are automatically incurred at the outset or during the life of the plan, regardless of the investment choices made subsequently. The Standard Life SIPP also offers innovative remuneration options for advisers, allowing them to tailor their remuneration for individual clients. Importantly, unfunded commission is not available on the SIPP remuneration menu, thereby limiting Standard Life’s capital exposure.

The information on this site is for qualified advisers only and must not be relied on by anyone else. If you are not an adviser you should go to our main website for information about our products and services.

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