Tech Review: A closer look at Selectapension

Mark Loosmore of AT8 Group looks at pension transfer offerings from Selectapension, including a specific QROPS analyis tool.

This week we had the opportunity to see a demonstration by Selectapension, the pension transfer tool provider, and to discuss the product’s use with managing director and founder Andy McCabe, and sales director Daniel Cheeseman.

The pensions transfer market is a complex area fraught with risks over how analysis is carried out and the implications of inappropriate advice. There is a stigma around misselling that dates back many years and some advisers shy away from the area as they do not feel equipped with the tools or knowledge to tackle some of the challenges.

Two major players

The pensions transfer software market has been undersupplied for many years and even today only has two major players – O&M, that has led the market for many years and the more recent entrant, Selectapension.

It is a complex market proposition that needs not only a prowess in software development and product management but also a detailed knowledge of pensions and financial services. Further, to create an effective tool requires the understanding of how to structure complex analysis in a manner that is simple enough to be used by non-specialists combined with an ability to run a robust data sourcing and analysis process. After all, the tool is only as good as the data that powers it.

Selectapension

Selectapension was launched in late 2003 by McCabe, who had previously worked at Legal & General where he was responsible for the creation of several systems to analyse the transfer of assets into L&G schemes.

However, McCabe was always limited by the fact that the only destination for the funds was L&G and he saw a gap in the market to offer an industry-wide solution.
Selectapension positions itself as a progressive company constantly driving innovation into its solutions. It is aggressive in its marketing style and confident in its own capability.

The offering

With access to provider data and live data feeds from AKG, Selectapension has a number of transfer analysis and pension planning products available. At the heart of its offering is the money purchase module – a transfer analysis tool that allows advisers to assess whether a transfer is appropriate by providing critical yield calculations and projections. The tool can work with multiple ceding pension schemes and provides a clear output at the end in line with the FSA transfer template.

Selectapension also provides a defined benefit tool to carry out a comparison of the different schemes calculating critical yield using all standard revaluation methods.
In addition to the transfer analysis tools, the product suite also includes a retirement planning tool.

Although some advisers will already have access to retirement planning functionality in their existing practice management solutions, Selectapension provides advisers with functionality that can take existing data from the transfer analysis exercise and run client planning scenarios including ‘cost of delay’ to support and add value to the advice process.