Legal & General (L&G) has received approval from the Financial Conduct Authority (FCA) to deliver targeted support.
This will enable L&G to provide more tailored communications to defined contribution workplace pension members.
The first use case will focus on members whose pension savings are fully invested in cash, allowing Legal & General to highlight the long-term risks of holding retirement savings in cash, including inflation erosion and limited growth potential and suggest possible next steps.
The firm says testing of its targeted support communications showed strong engagement, with 85 per cent of individuals wanting to read the materials, 95 per cent finding them easy to understand and 93 per cent clear on what to do next.
L&G says the approval will allow it to expand Targeted Support across its wider pensions offering, helping bridge the gap between guidance and regulated advice.
Its research found 32 per cent of individuals have experienced significant life changes over the past decade without materially changing their financial habits, while 41 per cent of employees aged 25 to 55 are not on track for the retirement income they are likely to need.
L&G CEO, Retail Laura Mason says: “After a significant period of planning and preparation, securing FCA approval for Targeted Support is an important milestone. What sets L&G apart is how we are going to be able to embed it across the full retirement journey. By integrating these capabilities into our existing tools and propositions, we can move beyond simply presenting options to actively highlighting the most relevant path based on people in similar circumstances. This helps narrow down retirement decisions, making them easier to understand and act on, supporting members to build long-term financial confidence with greater clarity.”
L&G CEO, DC & Workplace Savings Paula Llewellyn says: “Over the past few years, we’ve built a clearer picture of what helps people engage with their pensions and take the next step. When support reflects someone’s circumstances and arrives at the right moment, it becomes much easier to act. That’s why we’ve focused on using data and behavioural insight to make our communications even more relevant and practical over time.
“Through tools like our Guided Retirement Planner, we’ve seen how relevant content and clear steps can help people build confidence and move forward with their decisions. Targeted Support allows us to build on that, giving members more practical suggestions based on people in similar circumstances, helping them make progress with greater clarity and confidence. It also means we can deliver a more consistent experience, where each interaction builds adds to previous ones, making our support increasingly valuable over time.”