Not upheld: unsuitable pension transfer advice complaint against Quilter Financial Services Limited

Decision detail

Summary

Ms F complained that Quilter provided unsuitable advice to transfer out of her DB occupational pension scheme in 2020, resulting in loss of guaranteed benefits. Ms F's primary objective was to access tax-free cash to fund home renovations; she did not require income and wanted remaining funds invested for her daughters. The adviser recommended transfer to a SIPP, which Ms F accepted and executed. In 2025, Ms F complained citing marriage breakdown and a £712,000 shortfall in equivalent benefits. The ombudsman found the advice was suitable because it met Ms F's objectives: she accessed her TFC without taking unwanted income, her husband's pension was sufficient for their retirement needs, and she achieved her goal of leaving funds to her daughters. Although she would receive lower benefits overall, the required 4.26% annual growth was achievable given her moderate risk appetite and investment horizon.

The Ombudsman's reasoning

The ombudsman found that although Ms F would receive lower overall benefits than her DB scheme provided, the transfer was in her best interests based on her individual circumstances. Ms F's primary objective was to access TFC for home renovations without requiring income, and she did not need the spouse's pension benefit because her husband's pension was sufficient for their joint retirement needs. The adviser reasonably concluded Ms F was not reliant on her DB pension given Mr M's income, rental property income, and planned lodge rental income. The 4.26% annual growth required to replicate her personal pension benefits (excluding spouse's pension) was achievable given her moderate attitude to risk and 10-year investment horizon. Ms F had explored alternatives (taking benefits directly from the DB scheme, selling the buy-to-let property, purchasing an annuity) but these did not meet her objectives of accessing TFC without taking unwanted income and leaving funds to her daughters. The ombudsman noted that Ms F approached the adviser with a clear, pre-formed plan and proceeded with informed consent after understanding she would receive lower benefits.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website