Broadstone has launched a new service to support support trustees and sponsors of DB schemes that remain in legacy insured contracts.
These older contracts are more likely to contain guarantees and more unusual investment structures and charges, which can create additional complication for trustees and sponsors.
At the same time, increased regulation over previous decades, has led to many insurers reducing the service and support offered on these older contracts – or in some outsourcing or withdrawing from the market altogether.
Broadstone says that as a result trustees have to often feel neglected and can be paying higher costs while dealing with these additional complexities when assessing their exit strategies.
The new service, called Broadstone CARE, will follow a four-stage framework — collate collate, analyse, recommend and executive — designed to offer clarity, structure and certainty around costs.
It is a full-service proposition that explains the contract and analyses solutions before offering advice and execution to facilitate the end-game strategy.
The objective of Broadstone CARE is to ensure value is maximised from the contract, whether by retaining it or exiting to Broadstone. In either scenario, the trustees and sponsor will be fully supported to achieve their objectives.
Broadstone head of trustee services Chris Rice says: “These legacy insured contracts were a great idea when they were initially set up, providing a ‘one stop shop’ for all services and including valuable investment guarantees.
“However, the evolving regulatory environment and financial conditions have caused insurers to look at ways of reducing their exposure to these contracts, encouraging exit, outsourcing, removal of services or even withdrawing from the market entirely.
“It is important that these schemes receive the necessary, specialist advice to maximise value from either running or exiting the contract and receiving services from a dedicated and attentive team of experts. Broadstone CARE seeks to achieve this and offers a comprehensive process to ensure trustees and sponsors can evaluate their options and maximise value.”
