As industry professionals, we are being asked to assist trustees in a number of areas where prior assessment of data is crucial to determine the extent of the job ahead and identify areas of focus to drive its delivery; a prime example is endgame preparation. It is a significant piece of work that requires plenty of prior dialogue and planning.
Enable clients and insurers to see the bigger picture
Whilst the Pensions Regulator (TPR) data measurement scores provide an indicator as to the robustness of data for its needs on a ‘business as usual’ basis, this will only provide partial guidance for an insurer seeking significant comfort that your trustees’ data is transaction-ready.
Therefore, a proactive approach in engaging with clients (trustees and sponsors) is required when considering data analysis for endgame purposes:
- Discuss with your clients: the areas of data that insurers would seek their opinion and could potentially require review and cleansing. Any proposal should concentrate on such data items (contingent spouse’s information, for example)
- Act decisively: assess data at the earliest opportunity and conduct a series of robust tests on data items needed to achieve your client’s endgame goals
- Provide clients with a comprehensive report and identify the areas to focus remedial work: create a data cleanse plan and identify how you may resolve those data anomalies; honing in on those data fields critical from an insurer perspective should allow you to build up an order of priority for cleansing work
- Catalogue known issues in the data: use the knowledge of experienced administrators, advisers and trustees to set out the limitations of such data. Risk areas to flag could include changes of administrator and/or administration system and implementation of historic changes in benefits
- Be flexible: could such reports encompass other future work streams such as a guaranteed minimum pension (GMP) equalisation data analysis?
This is a relatively low-cost exercise that will assist in the planning process and the benefits should more than pay for itself in allowing clients to focus on what areas of data need cleansing. Such reporting will also help in the planning and implementation of any interim exercises such as member options.
An environment of partnership and co-operation is essential. Clients have differing timelines and levels of financial resource so listen to them and expect to be challenged on any of your proposals. That said, such reporting should always enable clients to understand what is required and put them in a position to take advantage of opportunities in the marketplace.
After all, as we have recently been told, a stitch in time saves nine.
This article was featured in Pensions Aspects magazine November/December edition.
Last update: 27 January 2021