There are times when solutions need to be found for clients that are both cost effective and almost immediate.
The target company employed 80 staff whose employee benefits included an existing pension scheme receiving a contribution of 3% from the employer if the employee also contributed 3% and an existing Group ‘Death in Service’ scheme covering up to four times salary. Seventy-five employees were in the pension scheme and all 80 were in the Group ‘Death in Service’ scheme.
ABC Ltd will be meeting its obligations to Auto Enrolment from 1st April 2014 and has set up a pension scheme to enrol employees. ABC Ltd currently has no ‘Death in Service’ scheme for its own staff. However, it was also legally obliged to provide identical pension and life cover provision for the newly-acquired employees, and have those policies in place by the end of that 48-hour deadline.
Mark Redman contacted the ABC Ltd pension scheme provider who had no problem enrolling a further 80 members into the pension scheme (75 immediately with the same contribution level of 3% + 3%, with the other five employees to be automatically enrolled as part of the companies auto enrolment obligations).
Mark researched the market for Group Life ‘Death in Service’ providers and requested quotes based information provided by ABC Ltd for the 80 new employees. Only one provider was able to set up a scheme to be active by deadline day and this was set in place. With this secured Mark followed up with further research and found identical cover elsewhere for a cheaper premium – saving the client around 20% on their existing premium.
We would never recommend those companies preparing for auto enrolment or considering other financial planning to leave their decision making to the last minute as it may result in an unsatisfactory ending. But this case study shows just what can be achieved when a 48-hour turnaround is required.