Scottish Life is marketing a new way to look at risk and suitability associated with the so-called "default" option of managed funds for group pension schemes.
Changes follow criticism contained in official reports, such as Myners, of how such funds are constructed and allowed to operate at different risk levels over time to the detriment of end customers. Scottish Life, part of the mutual life insurer Royal London, adds it is pretty clear regulatory pressure on advisers means they must be able to provide evidence of ongoing suitability where such default options are selected for group scheme members. The provider’s solution is essentially to come up with new stochastic modelling benchmarks consisting of combinations of levels of risk deemed...
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