OREANDA-NEWS. February 04, 2016. Aon Hewitt, the global talent, retirement and health solutions business of Aon plc (NYSE:AON), has said that clarifications to the Code of Good Practice on pensions incentives back up what the company is seeing in practice.

The Code, published by the Incentive Exercises Monitoring Board (IEMB), was originally introduced to help support companies and trustees to run member option exercises such as transfer value and pension increase exchange exercises. It is a voluntary code based on seven key principles, such as the provision of financial advice and clear communications.

Ben Roe, partner at Aon Hewitt, said:
“The changes to the Code are fairly minor in nature which is testament to the success of the original Code released back in June 2012, especially given the significant changes introduced by the Pensions Freedom and Choice regime in April 2015. The clarifications made by the IEMB support what we see in the market, where exercises are following the Code and helping to support members.”

One of the key inclusions in the recent update is a list of boundary examples, helping companies and trustees to determine what is and what is not within the scope of the Code as well as useful information on what advice should be paid for by the company and what should be paid for by the member.

Ben Roe continued:
“We have seen mixed market practice in this area in the past which has led to some confusion. The clarification in this update is particularly welcome as we expect this to continue to be an area of interest as more trustee boards look to quote transfers automatically when members retire.
 
“Another area Aon expects to see large growth is in middle ground solutions to help support members at retirement. We expect increasing focus on models, tools and guidance to help members to have a better understanding of their options.”