Scottish Widows and LV have followed Old Mutual Wealth and Standard Life which suspended their free Tvas services last week.
Prudential has gone one step further and withdrawn its Tvas tool altogether.
The suspensions come after the Financial Conduct Authority (FCA) updated its policy on DB pension transfer on 26 March.
In the announcement, the regulator expressed concerns that the pension transfer reports provided by companies to advisers could act as an inducement and took the position that they likely fell outside its new rules and guidance.
Domino effect
A Prudential spokesperson said it withdrew its Tvas service on 29 March.
“This follows the publication of the FCA policy statement 18/6 where it has made it clear that it is neither acceptable for a provider to offer this service without charge or for an intermediated adviser to accept such a service,” the spokesperson said.
An LV spokesperson said it has suspended its service with immediate effect, however any current cases in the pipeline would be completed, including any re-quotes received by 6 April.
“LV is fully supportive of the regulator’s moves to increase consumer protection in the DB transfer market, as it’s absolutely vital that only those who would benefit from the pension freedoms transfer out, and not anyone who would be worse off as a result.
“We recognise there continues to be strong consumer demand in this space and we are looking at what support we can continue to offer advisers to help them in this area of pension planning,” the spokesperson said.
A representative of Scottish Widows said the firm had withdrawn its free service until further notice.
“To avoid disruption for advisers and their clients, we will fulfill the small number of existing requests that are already in progress,” the spokesperson said.
Novia introduces fee
Novia has also responded to the rule change, but rather then suspend its service it has introduced a “small charge” of £75 (€85, $105) plus VAT.
“The charge covers our costs and will be payable by adviser firms using the service. We will not levy a charge for the completion of any existing cases, or any cases which require a re-quote,” a spokesperson said.
Tighter rules
The tougher stance on Tvas was made as the regulator looks to modify the rules and guidance on inducements for non-Mifid business to mirror more closely the Mifid II rules.
In addition to Tvas services, the regulator is also taking a tougher line with appropriate pension transfer analysis (Apta) services offered by firms.
The FCA said in its statement last week: “This means that non-monetary benefits which were previously not included in the inducement rules are now included. We consider it is unlikely that providing or accepting free Tvas or Apta software would fall within the narrower definition and so should not be used.”
