Prudential has promised “appropriate redress” to customers affected by service issues on its savings and income retirement account.
Launched in September, Prudential called the service a ‘game- changer’ in offering customers the opportunity to accumulate and withdraw money from the account at the same time. But less than a year later it has already been plagued by administration issues.
The provider said the problems were due to unexpectedly high demand for the service.
It said it would be conducting a review of the service as a result and promised “appropriate redress” for any customers financially affected by the problem.
A spokesperson 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.”
They added: “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.”
‘Game-changer’
The advised-only retirement account allows people to save for and during their retirement, and to access their cash at any point from the age of 55 without having to cash-in or cancel the entire account.
Prudential said it wanted to give people the “flexibility and freedom” they need for their retirement post-pension freedom reforms.
“It’s a pension freedoms-based product basically doing all of the things you can do under the new rules – it’s a game-changer,” head of business development Vince Smith-Hughes (pictured) said at the time of launch.
It also offers a set of optional guarantees, including a ‘capital guarantee’ for drawdown and a ‘minimum income guarantee’, which act similarly to an annuity product, guaranteeing an annual income throughout retirement even in the event the value of the fund plunges.
The product charges between 0.25% and 0.65% depending on how much is invested in the service, with investment and option guarantee charges applying separately.
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