The Pensions Regulator

Member retirement options

.

.

.

Process

The responsibility sits with the trustees to ensure their DC scheme or arrangement has processes in place that ensure:

• the member (or dependant) is told about their options (including the availability of the open market option); and
• the member’s fund can be converted into an income.

The regulator’s research suggests that although schemes may have different practices in relation to aspects of the decumulation process, the overall end-to-end process will be broadly similar for all schemes.

The end-to-end process a trust-based DC scheme will usually follow in order to secure its scheme pensions or annuities is illustrated below in Figure 2.

Where a DC scheme is insured the trustees will no doubt want to ensure that the insurance company’s procedures will fit in with scheme practices and processes.

Figure 2: Diagram to show a good practice timeline for the retirement process

You might want to take a look at a more detailed description of the process (Annex B).

.

.

.