The OMI survey found that two-thirds (67%) of those surveyed think that demand is being fuelled by fear DB schemes will not be able to meet their long-term liabilities.
In addition, a similar number (66%) also identified improved transfer value / critical yield as a factor driving demand.
Growing demand
Four in 10 financial advisers globally have seen a rise in demand for DB pension transfers in the past 12 months.
A third (35%) expect demand to continue increasing over the next year.
In the UK, advisers unsurprisingly experienced the biggest growth in demand, with 83% saying they had seen an increase in the last year, with just over half (54%) having seen a significant increase.
Seven out of 10 UK respondents expect demand to increase over the next 12 months.
Greater freedoms
Almost all (91%) of UK advisers identified the pension freedoms as the catalyst for DB pension transfer growth, compared with 58% globally.
When asked by OMI to predict how much demand will increase over the next year, advisers across all regions expect to see, on average, a third more business.
Suitability
The high DB scheme deficit and the record low gilt yields are understandably causing concern, OMI said.
Combined with the relatively high transfer values and it is easy to see why the demand for transfers has risen.
However, the insurer cautioned that financial advisers must ensure each case is carefully considered before carrying out a transfer and that they have the appropriate permission from their regulator to conduct such transfers.
Pension transfers away from DB schemes are irreversible, and may not be suitable for all clients.
David Denton, head of international technical sales, Old Mutual Wealth, said: “UK-based advisers have previously been fairly cautious when it came to defined benefit transfers, as decisions were seen as high risk and irreversible.
“With 71% of UK advisers saying they expect demand to increase, we may be seeing the tide turning, with more advisers prepared to take on such cases. It is important advisers continue to assess each case on its own merits as defined benefit transfers will not be suitable for all clients.”
