Two benefits providers have partnered to set up an AI-driven pensions tracing service to find lost and difficult to locate retirement funds.
The launch of the initiative, from Zedra and Heka Global, follows an AI-trial that recovered 50 percent of members’ pots that had previously been unreachable using commercial tracing services.
The project will help smaller schemes to reunite members with pots by accessing economies of scale typically unavailable to them. It will also mean larger schemes can operate faster and more efficiently than with traditional lost pots services, the providers said.
Mark Stopard, head of proposition development at Zedra Governance said there are more than £31 billion in unclaimed pension entitlements and more than three million inactive or lost pension pots.
“Re-uniting pension members with their full retirement benefits is one of the biggest challenges facing the pension industry today,” he said.
“Making sure all members receive their benefits is a core fiduciary duty, as is controlling the financial costs of missing member data.
“Further to that, tracing these individuals will allow schemes to significantly boost their ability to re-engage members.”
Stopard added: “We’re excited to see the results of this initiative.”
Heka business development manager Max Lack said that numbers of unclaimed pensions continue to surge, adding that they are driven by many factors including rising professional and geographic mobility.
“Changes in members’ communication preferences have also exacerbated the trustees’ challenge of restoring contact as traditional postage is being overtaken by numerous digital channels.
“Many of the toughest challenges in the pensions sector – de-risking data exercises, dashboard readiness, retirement adequacy – stem from missing member data. Get this solved and things start to become easier.
“Emergent AI tools offer a powerful solution to addressing these data gaps, and our recent pilot clearly demonstrates the effectiveness of this approach. We look forward to working together to bring the same benefits to further pension scheme clients.”
