Prudential pledges to compensate pension customers

Prudential, one of the UK’s largest pension providers has pledged to provide compensation to customers after 17,000 retirement accounts were financially hit by an administrative glitch.

The retirement account first launched in September 2016, less than one year ago, following changes to the flexibility of pension law. Prudential has said that the issue had been caused after they faced higher-than-expected demand for the popular product.

Reports showed that some customers were incorrectly taxed, and the FT Adviser reported that one advisor was struggling to take out a client’s income before the end of the 2017/17 tax year.

The retirement account combines a pension savings account and a pension income account, all in one place. The product was introduced after changes were made to pension rules in 2015.

The amendment gave over 55’s the right to access their pension as they wish, without purchasing an annuity.

A representative for Prudential said,

“The demand for our new Retirement Account has been much higher than we expected and unfortunately that has impacted the service we have been able to provide to customers and advisers.”

“We’ve been working very hard to resolve this and I’m pleased to say that our service levels have now been restored. We want to ensure that no one has been financially disadvantaged and therefore we are reviewing relevant transactions and will be providing appropriate redress.”

“We are very sorry for any problems this has caused for customers or advisers and we are writing to customers to apologise.”

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