FCA tells non-workplace pension providers to act on legacy product value failings

Action required if you hold a closed book of non-workplace pensions. Worth noting for others.

The FCA published findings on 2 July 2026 from a multi-firm review of unit-linked non-workplace pension and savings products, concluding that customers in legacy products closed to new business could be receiving poorer value than those in newer equivalents. The market is substantial: industry figures put it at around 17 million policies and approximately £500bn of assets, with around half of the policies in the FCA's sample sitting in closed products.

The FCA identified three drivers of the problem: complex charging structures, older product design, and gaps in firms' data. The first two make it harder for customers to judge whether they are getting fair value; the third limits firms' own ability to assess outcomes and act on what they find.

This is Consumer Duty work. The FCA has told providers to ensure customers get fair value and that products support good outcomes, as the Duty requires.

The FCA is not prescribing a single fix; it is pointing to good practice already visible at some firms and expecting the rest of the market to catch up. The most significant actions it highlights are capping or reducing charges for customers in legacy products and migrating customers to better-value alternatives. Some firms are also rationalising legacy products and funds, and comparing outcomes across different customer groups.

Charlotte Clark, the FCA's director of cross-cutting policy and strategy, said: "Consumers in older products should not be left behind, and the good news is that some firms are already showing it doesn't have to be this way. We want to see that progress reflected right across the market."

The FCA has not set a deadline for adopting the good practices or signalled enforcement action, but the expectation is now explicit on the record. The regulator says it is also engaging with firms to understand the barriers to improving value in closed books.

If you manage a closed book of non-workplace pensions, read the review report. Demonstrate ongoing fair value; do not simply leave legacy products on the shelf.

Sources

• Pension firms must do more customers older pensions fund savingsfca.org.uk
• mallowstreet.commallowstreet.com
• FCA warns pension firms over value offered by older pension productsworkplacejournal.co.uk
• 41eb1bbcontent.govdelivery.com