OPDU launches independent pension trustee liability policy

High profile company collapses such as Carillion and the failure of high street chain BHS have put the role of the pension trustee centre stage.

Indeed, trustees have a huge headache with the aggregate deficit of the 5,588 schemes in the Pension Protection Fund 7800 Index at a not insignificant £38.7bn at the end of September 2018.

To ease the burden, many pension schemes have appointed an independent trustee to improve their board functioning and to enable the best possible financial outcome for all parties involved.

The OPDU, a provider of professional indemnity and liabilities insurance to trustees, administrators and sponsoring employers, has launched a pensions trustee liability policy specifically aimed at such individuals in the UK.

Often, independent trustee appointments are single individuals who have either set up their own companies or who trade in their own names. These individuals may have multiple appointments. The role of independent trustees and the need for minimum standards, qualifications and insurance is an area of ongoing debate and consultation in the pensions industry.

OPDU’s new individual independent trustee liability policy will now cover such individuals for insurance in a standalone policy in the name of the individual trustee only, independent of any other policy offered by a scheme sponsor or under scheme provisions.

Martin Kellaway, executive director at OPDU, said: “This new OPDU policy is designed to stand in front of any existing protections and provide peace of mind for individual independent trustees, and will cover all pension schemes the trustee is appointed to. It can only be called upon by the named trustee and not any other trustees of a scheme and is a further example of maintaining the high professional standards of the independent trustee.”

Other providers of pension trustee indemnity insurance include Chubb, AIG and Bluefin Professions.