Last week the regulator announced proposals for this part of the sector. These included scrapping guidance that the adviser should start from the assumption that a transfer will be unsuitable.
The proposed changes also include requiring transfer advice to be provided as a personal recommendation, and replacing the current transfer value analysis with a comparison to show the value of the benefits being given up.
Jim Stevenson, pensions technical manager at Ascot Lloyd, said: “While we’re in favour of the FCA proposals as they stand, they will inevitably make transfers more demanding and harder to justify.
“The proposals are likely to increase the demands on qualified pension transfer specialists, who are now expected to be able to demonstrate relevant experience, up to date knowledge and the depth to which they review reports.
“All of this can only increase the cost of advice provided to potential transferors, but given the large sums involved in many transfers, their very size makes expert and qualified advice all the more important.”
The FCA consultation report stated: "It remains our view that keeping safeguarded benefits will be in the best interests of most consumers. However, the introduction of the pension freedoms has altered the options available and for some consumers a transfer may now be suitable when it wasn’t previously.
"We therefore propose to remove the existing guidance that an adviser should start from the assumption that a transfer will be unsuitable. This will be replaced with a statement in the Handbook that for most people retaining safeguarded benefits will likely be in their best interests and guidance that advisers should have regard to this.
"This will not require an assumption to be made by an adviser. An assessment of suitability should focus on whether a transaction is right for the individual and should be assessed on a case by case basis from a neutral starting position.
"The adviser needs to demonstrate that the transfer is in the best interests of the client."