Standard Life Increases the Cost of SIPPs

Standard Life, one the largest UK pension providers and the leader on the market of self invested personal pensions (SIPPs), recently announced that it increases the cost of plans. Existing customers will face higher fees, whereas new customers will see a £750 exit penalty introduced.

As such, the increase in plan charges will amount to 4%. As for new customers, who will sign up to Standard Life SIPPs from January 2011, they will face a £750 exit penalty should they want to switch to another provider in the first year.

The move of Standard Life comes in contrast with falls in the cost of self-invested private pensions offered by other providers, which do their best to attract new clients.

Commenting on the changes, Mr. Hardie of Standard Life said that the terms have been changed to deter financial advisors who have been abusing the company's deals.

Even though the fees introduced by Standard Life are among the highest on the British market, they are transparent, thus being in line with the regulatory principle of “Treating Customers Fairly” (TCF).