BLOG: Seizing the opportunity to unlock lost and dormant assets
This week the Dormant Assets Scheme (DAS) expanded to encompass pensions and insurance policies, with Aviva leading the charge as the first company to sign up. This is a positive step, and it is good to see dormant assets being raised as an issue.
However, despite the Government reiterating that first and foremost the reunification of dormant assets to their rightful owner is key and should be the priority for financial services firms, there is still much to be done by firms to make the process of finding and claiming dormant assets simple and centralised for consumers.
The figures speak for themselves; we estimate that 20.8 million people in the UK have become disconnected from a total of £78bn that is currently sat languishing in lost or forgotten accounts. Consumer awareness around forgotten pensions, savings and bank accounts is low and those who have tried to get their money back have faced multiple barriers.
At Gretel, the free online hub that tirelessly assists people in reconnecting with their lost accounts across the entire financial services industry, we are keen to do everything we can to encourage people to start looking for and reclaiming what is rightfully theirs.
While supporting the underlying purpose of the DAS and its invaluable contributions to charitable causes, reuniting consumers with their rightful assets should take precedence. There is a need in the current UK financial landscape for simplicity and centralisation in helping people find and claim dormant assets.
Lack of awareness of the Dormant Assets Scheme
Research conducted by Gretel reveals a stark lack of consumer awareness regarding the Dormant Assets Scheme.
Astonishingly, only one in ten individuals are familiar with the scheme, and of these, only half (54%) again were aware that the scheme had been recently extended beyond banking.
Furthermore, almost half (45%) said they were uncomfortable with their (dormant) money being used by the scheme without their permission, with just 36% stating they were “comfortable” with their forgotten money being used. These findings underscore the urgent need for comprehensive public education campaigns to raise awareness about the benefits and procedures of reclaiming dormant assets.
Aviva’s pioneering decision to join the expanded DAS scheme is a significant step forward, particularly within the pensions and insurance industry. Having worked closely with Aviva as part of the Dormant Assets Commission, it is abundantly clear it is committed to tracing customers diligently, prioritising the reunification of assets with their rightful owners before releasing the balance for distribution to good causes via Reclaim Fund.
The search for dormant assets
Whilst we need more financial companies looking at this issue and removing the unnecessary barriers, consumers can also take the initiative and start looking for the money that is rightfully theirs.
For individuals keen on initiating their search for dormant assets, several practical tips can serve as a starting point.
To encourage individuals to embark on their own asset search, here are a few tips as a starting point.
Gather relevant documentation and information about past accounts, policies, and investments. This could include bank statements, insurance policies, pension documents, or even old paperwork from financial institutions. It doesn’t matter if you don’t have all the documents.
For many of us we also face the difficult task of managing the estate of a loved one, with the often complex and time-consuming job of tracking down both current and dormant financial accounts.
Our research highlighted that a quarter of adults in Britain have had to deal with the estate of a relative or friend who has passed away, for example closing down bank accounts or seeking out pensions and investments, rising to 41% of those aged 55+.
Now, more than ever, as the cost-of-living crisis looms and financial challenges intensify, it is imperative that individuals take the initiative to locate their lost and dormant assets.
The expansion of the Dormant Assets Scheme to include pensions and insurance, serves as a wake-up call for saver to reclaim what is rightfully theirs.
By taking advantage of the resources available, individuals can navigate the process efficiently, ensuring that they receive the financial support they deserve.
It is time to seize this opportunity, empower ourselves financially, and reclaim what is rightfully ours.
Duncan Stevens is chief executive of Gretel