Aegon pays out £20k after pension transfer delay

Provider Aegon has paid almost £20,000 compensation to a customer after a delay in administering his pension led to him missing an investment opportunity.

The Pensions Ombudsman ruled that Aegon delayed the payment of complainant J A Thomas' funds from its own SIPP into an IPS Partnership vehicle.

Thomas had planned to invest £500,000 of his fund in a National Savings and Investments (NS&I) bond with a fixed interest rate of 4.25% per year compound.

Aegon received instructions to disinvest assets in Thomas' portfolio so he could move them on 20 November 2009, but Aegon employees could not find his policy documents.

Due to the delay, Thomas' instructions were not completed until 15 December, but the NS&I bond had already been withdrawn, on 27 November.

The Association of British Insurers' (ABI) good practice guidance on pension transfers suggests ten working days as a timescale for the completion of requests relating to pension transfers.

The Ombudsman ruled that Aegon must compensate Thomas £19,761 for the interest he lost by not having invested in the NS&I bonds, plus £100 for distress and inconvenience caused.