Quality stamp may allow Sipps to be bought without advice

Added 18th May 2016

A new UK quality mark aimed at helping consumers choose self-invested personal pension (Sipp) products without the help of an adviser will be launched this summer.

Quality stamp may allow Sipps to be bought without advice

Pension Quality Mark (PQM), a subsidiary of the trade body the Pensions and Lifetime Savings Association (PLSA) has created the Retirement Quality Mark (RQM) to help customers choose ‘in-retirement’ products such as drawdown plans without consulting a financial adviser.

In November 2015, the PQM confirmed that the RQM will be introduced in mid 2016, although no date has been specified.

Seal of approval

The seal of approval will be offered to schemes that have an Independent Governance Committee (IGC) as well as quality default funds in case the customer doesn't want to choose their own.

PQM chairman Adrian Boulding reportedly told industry conference on Tuesday that the UK’s pension freedoms, introduced in April last year, had resulted in more people opting for Sipps over annuities due the inheritance tax (IHT) benefits and drawdown options involved.

He also raised concerns that many of these customers could be investing in products they do not understand.

"They will have considerably smaller funds than previous generations, be less able to take market shocks, and won't have much of a clue as to where to invest," he added.

In a consultation paper published in October last year, the organisation said the RQM will "signal to savers that there is an independent assessment of the quality of the product they are buying".

The paper also warned that the award "does not guarantee against a saver drawing down their income too quickly and running out of money".

When contacted by International Adviser about whether the RQM will be recognised by the government, a PQM spokesperson said it was still assessing the results of the consultation before it outlines a structure.


Pension Quality Mark, launched in 2009, is designed to recognised high quality workplace pension schemes. According to its website, it has awarded 190 schemes across the UK.

Focusing on two standards, to qualify for a PQM schemes must have contributions equal to at least 10% of an employee’s pensionable salary, with a minimum employer contribution of 6%.

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Monira Matin

Senior Reporter

Monira joined International Adviser in March 2016 from Informa Global Markets where she worked as a eurobond reporter for over two years, covering fixed income markets. She has previously held a number of editorial positions covering politics, insurance and technology. Monira has a degree in Journalism and Economics from City University.


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