Member Options

More Support for Members,
More Certainty for Sponsors

Senior female considers the Member Options from her pension scheme for upcoming retirement

Insight Hub

Member Options

More Support for Members,
More Certainty for Sponsors

Giving members some choice has long been a part of the DB pensions system. The opportunity to take a tax-free lump sum at retirement or, prior to retirement, take a cash equivalent transfer value are both long established options which are available to all. However, in response to the changing needs of members, more and more pension schemes have been adding new options to the menu such as pension increase exchange (PIE), bridging pension options and partial transfer options. Now more than ever, it is important members have support alongside this choice to ensure they understand the available options and make decisions appropriate to their unique situations.

Member options are not only a great opportunity for members by giving them choices they value, but these bring many benefits for trustees and scheme sponsors too. Many options have the effect of accelerating payments, reducing risks such as inflation risk or removing the financial risk of meeting the liability completely in the case of a transfer value. This helps those running the scheme to plan because the scheme’s finances are more predictable. Increasingly, member options are therefore an integral part of schemes’ journey plans whether these end in buyout or the scheme intends to run on for many years.

More choice is great for members as it allows them the most flexibility to shape their retirement benefits to best fit their individual needs. However, with choice comes the need to help members choose because these decisions are complicated, have significant financial implications and really do last a lifetime in many cases. The direction of travel for a number of years has been for trustees and scheme sponsors to introduce more support around retirement decision making – from better communication of the options through to online modelling tools and independent financial advice for members. This goes hand in hand with the new and existing member options which are made available.

Aon is well placed to help trustees and sponsors consider which member option solutions best meets their needs. We have a dedicated Member Options team comprising over 65 specialists, providing advice and support on the full range of member options, including flexible retirement and pension increase conversion exercises. We are seeing trustees and companies value the increasing benefits of running member options exercises in conjunction with wider projects such as settlement and GMP equalisation. With specialist knowledge, Aon have developed modelling tools to help schemes design the most effective exercise, given a scheme’s objectives and membership profile. Furthermore since 2018, Aon’s Member Options team have collectively spent over 120,000 hours on member options projects, with over 30,000 hours dedicated to research and development.

Get in touch with our Member Options Specialists

Member Options Tools

Bearded man reviews his pension options using the Aon Retirement Option Model tool on his tablet

Aon Retirement Option Model (AROM)

An easy-to-use, web-based tool helping members understand and identify the best pension choices for them.

Female views data regarding pension option using Pension Increase Exchange (PIE) Modeller

Pension Increase Exchange (PIE) Modeller

Supporting pensioner members of defined benefit pension schemes with decisions to exchange their future pension increases for a higher pension.

With choice comes the need to help members choose because these decisions are complicated, have significant financial implications and last a lifetime in many cases.

More Support for Members,
More Certainty for Sponsors

Article Series


Improving Pension Outcomes: It Starts With a Nudge…

Andrew Gaskell and Richard Cook discuss why a “stronger nudge” should be just the start of greater support provided to members.


Enhancing Member Experience: A Silver Lining to GMP Equalisation?

GMP equalisation is a thorny issue and for some schemes it can be about choosing the least bad option. But what if it doesn’t have to be that way?


Member Security and Member Flexibility: Optimising A Buyout For Your Members

Gemma Cowan and Jamil Merali discuss the importance of considering members in the run up to buyout and whether a trustee’s obligations end when a scheme is bought out.


Are Your Member Communications Consistent with Wider ESG and I&D Goals?

As trustees, do you know and consider the Environmental, Social and Governance (ESG) and Inclusivity and Diversity (I&D) goals for your scheme or those of your supporting sponsor? As a sponsor, do you communicate your goals to the trustees?


Online Tools: Is Technology Helping Defined Benefit Members Make Better Decisions on Their Retirement Options?

It is no secret that technology plays a huge part in our daily life. This includes using technology to access financial services – for example, many of us now use mobile banking apps as part of managing our finances. But how do pensions feature in this increasingly digital world?


Member Views: Navigating All The Choice

Pension scheme members have more choice than ever when it comes to taking their retirement benefits. But does this lead to better decisions, or would they prefer it if things had stayed simpler? This article shares some feedback from members provided with extra options and choice.


What is your member focus for 2023?

William Engelhardt, associate partner at Aon, looks at the key themes likely to affect members of DB pension schemes in 2023

Key Resources

Senior Female thinks about her pension options. Key image for Aon's 2022 Member Options Survey

2022 Member Options Survey

Our fifth annual Member Options Survey collated the views of over 300 pension schemes. Building on the results of previous years, it continues to focus on the level of support available to members at retirement and the changes schemes plan to make over the next year.

Pensions scheme sponsors and trustees review Independent Financial Advisers for their members options

Regular Review of an Appointed Independent Financial Adviser

Aon has a tried and tested IFA governance update service that provides sponsors and trustees with an annual process for assessing the ongoing suitability of their chosen IFA(s) and the competitiveness of the services.

Electric workers have a conversion about pensions option after their scheme combines GMP Equalisation and PIE

Combining GMP Equalisation and PIE — A Success Story

Colin Ross from Electricity North West discusses their success story in combining GMP Equalisation and Pension Increase Exchange (PIE) during this short video.

Senior man disusses his retirement decision for the Aon survey on making better pension decisions

Making Better Decisions That Last A Lifetime

To deepen our understanding on the ways that individuals make their retirement decisions, we undertook in-depth interviews with individuals who had retired within the last five years. These insights are explored in this report.