In Your Shoes - James McDonald

Monday in Aberdeen

I caught up with colleagues in the office before heading to a clients office to debrief on a recent switch in pension provider.

Group pension schemes are central to the success of an employee benefits package and that success is measured by crucial, tangible elements such as investment performance, investment strategy, technology (employer and employee facing), education and engagement. Despite this, employers are nervous about the prospect of moving provider even if one or all of those elements are failing. In utilising our services, our clients delegate a lot of the heavy lifting to us and can be confident in their compliance and the outcome of moving schemes. Staying with a provider that is underdelivering on service, technology or investment performance is damaging to a business and its people.

This client decided to act and Mattioli Woods:

•        Consolidated and checked all data and information from the existing provider

•        Requested terms from key account managers across multiple pension providers

•        Checked, collated and presented those terms in a formal report with a full comparison matrix

•        Drew on established provider relationships to give the client a clear, honest picture of each proposition down to the detail of service, investment, technology and employee engagement and education.

•        Narrowed down providers to a shortlist with the client and arranged provider presentations

•        Built a detailed onboarding timeline so the client knew exactly what was happening, why and when.

•        Worked with HR and payroll teams to prepare for the switch

•        Created bespoke content and delivered employee engagement and education leading up to and at the point of transition both digitally (email campaigns, webinars and videos) and onsite.

•        Supported the client through their first payroll run with the new provider

•        Managed the bulk transfer of funds from the old provider to the new alongside the provider.

It is a genuinely positive moment for a business to be able to announce a change that will meaningfully improve the financial wellbeing of their people. Employers often underestimate how much employees engage with their pension when the right tools, education and communication are put in front of them.

Tuesday in Dundee

Financial education and wellbeing engagement should not only happen during large projects or at renewal time. We maintain a consistent effort, delivering financial, physical and mental wellbeing resources all year round through email campaigns, webinars, videos and on-site sessions.

On Tuesday I was joined by a qualified, Mattioli Woods wealth manager and the client's pension provider at their Dundee office for a full day of employee engagement. We covered two main areas.

Pension Essentials: practical, hands-on guidance to help employees actually use what they already have

•        Downloading the provider app

•        Checking and increasing contributions

•        Analysing charges

•        Default investment fund performance and strategy

•        Nominating a beneficiary

•        Using the provider's tracing, transfer and projection tools

Retirement Planning: Where to start

•        The Retirement Living Standards framework and what income employees realistically need to live in retirement (£13k to £44k per year for a single person, depending on lifestyle BTW!)

•        The State Pension and how to use that foundation to build a plan

•        How the workplace scheme works, including contribution rates and the tax efficiency of salary exchange

•        Investment options: default fund, self-select, or financial advice, with a range including ethical and Sharia funds

•        Pension freedoms at retirement, covering annuities, drawdown, cash lump sum options and death benefit rules, with worked tax examples

Following the group session, my colleague held one-to-one meetings with 14 employees who wanted to discuss their personal circumstances and explore what financial advice could mean for them. Again, Employers often underestimate how much employees engage with their pension when the right tools, education and communication are put in front of them. To individuals reading, we believe that sitting down for an hour once per year is enough to make a difference to your long term planning. If you had 30, 100, 200+ K in an ISA, you wouldn’t ignore it. Please don’t ignore your pension.

A worthwhile day by any measure.

Wednesday at Dens Park

On Wednesday we welcomed clients, trusted partners and peers to Dens Park for an exclusive Mattioli Woods event. The club were excellent hosts and the feedback from attendees was brilliant to hear.

Our very own Sean McSweeney presented on our employee benefits technology platform, which offers:

•        A personalised benefits portal where each employee sees the benefits relevant to them

•        Flexible benefits selection, allowing employees to tailor their package across pensions, health, wellbeing and more

•        A total reward statement giving employees a real-time view of the full value of their package

•        Seamless integration with HR, payroll and benefits providers to keep data current and reduce admin

•        Targeted communications to reach specific employee groups with relevant, timely information

We also heard from the club's FD Alasdair McGill and again from first team manager Steven Pressely, who both spoke very well about the mad world of football finances and what business can learn from sport about motivating a team. Both were insightful and kept attendees engaged.

Delegates had lunch courtesy of the Dens Park hospitality team before a stadium tour of a proper, storied fitba’ ground!

Thursday in the Highlands

We renew over £24 million in risk and health premiums each year, so we are well aware of the pressure businesses face when Private Medical Insurance renewals land on their desk. When a valued client faces a significant increase, we move quickly.

I travelled to the client's head office in the Highlands where each drive reaffirms my belief we have one of the most beautiful countries in the world (and yes, those are actually pictures taken next to my client’s office!)  I was there to present the results of their Private Medical Insurance renewal.

The first task is always to make sure the client understands why an increase has happened.

•        New drugs, advanced diagnostics and surgical techniques all carrying significantly higher costs

•        Age-banded pricing automatically increasing premiums each year

•        Private hospitals passing their own rising staff and running costs through to insurers

•        Insurers correcting under-pricing against a backdrop of sustained high claims since 2022

•        The client's claims loss ratio running at around 95% and indicating an upward trend

•        The incumbent insurer's opening renewal terms came in at £139,536 which was a significant increase on the prior year’s premium of £78,683

It is then crucial that the client has a clear set of options to mitigate the increase

•        I took the renewal to market across five alternative insurers

•        I ran five rounds of negotiations with the current insurer and shortlisted providers, bringing their current insurer’s terms down from £139,536 to £97,748, a significant reduction on their opening position, just through negotiations.

•        Explored cost containment options including a higher excess, offset by excess insurance through the existing health cash plan to make the excess increase cost neutral to employees.

•        Presented all options transparently so the client could make an informed decision

•        Recommended a switch to a new insurer at £82,016

•        Secured a price cap at year two renewal, providing further protection for the next cycle

•        The new insurer matched cover on a like-for-like basis and provided continuity of care guarantees for any members currently mid-treatment

•        We arranged for a ‘care concierge’ service where if an employee opted in, the new insurer would call them directly before the switch to guide them through their claim transferring over.

•        Health assessments worth up to £350 per person were added to the policy for all members in year one free of charge.

•        We are supporting the client with an employee communication campaign including announcement emails, webinars and on-site sessions booked for October.

•        Total saving against the opening position: £57,520

Friday in Monifieth

The week ended spectacularly at the Rossie Trust Golf Day at the Ashludie course in Monifieth, which was in excellent ‘nick. Hearing more about the extraordinary work carried by Rossie, including their Coorie House project, is always worthwhile and the team there put on a superb day. Our thanks and best wishes to Rossie.

I am also pleased to report, for the 300th time, that team Mattioli Woods took home the win.