Almost nine out of 10 employers are set to review their pension provider this year, according to new research.
The research by Smarterly found that more than one in two employers(54 per cent) were planning to review this review within the next six months.
The research indicates that significant numbers may be motivated to switch: with around two thirds of employers (65 per cent) saying their existing providers are not offering innovate or progressive products.
Smarterly — which offers employers a workplace savings and investment platform — also found employers saying that customer service levels had fallen significantly, with many providers unwilling to “go above and beyond” minimum standards.
Smarterly head of proposition Steve Watson says: “Pension legislation has changed dramatically in recent years, which combined with financial pressures has seen a move away from defined benefit schemes to defined contributions schemes. But the products themselves have remained the same and there is very little innovation the market.
“With employers now legally obliged to enrol their employees into a pension scheme, existing providers are under very little pressure to innovate. They still seek to compete on cost, of course, but with a captive audience, providers see no need to design ground-breaking products or offer outstanding levels of service – they know that there is ample business out there to share around.”