MorganAsh worked with CML Microsystems PLC on its final salary pension scheme, helping the organisation gain a clearer understanding of the health, well-being and marital status of its scheme membership – and raise awareness of pension benefits with members.

Like many professional services or more white-collar industry firms, CML Microsystems’ pension scheme was based on assumptions derived from average data – including, for example, members’ health and number of members who were married.

However, when CML Microsystems instigated a medically underwritten mortality study with MorganAsh, many of those assumptions were proven to be incorrect. During the study, MorganAsh confidentially gathered up-to-date, accurate information on the health, lifestyle and marital status of actual scheme members. The resulting data revealed that fewer members than assumed were married – and that some members had underlying health conditions, so their life expectancy was lower than assumed.

By participating in the study of the scheme, which had liabilities of £22.7m as at end of March 2018, members became far more engaged with the scheme’s management and governance – and gained a significantly better understanding of their pension benefits. This resulted in more informed retirement planning, based on rigorously researched data. The new, accurate information enabled directors and scheme members to better evaluate the options of remaining or transferring out, so any decisions could be based on a clearer understanding of the impact of mortality on individuals – and the scheme as a whole.

The project also reduced the deficit in the scheme by around 10%.

Nigel Clark, finance director at CML Microsystems, commented: “The work which MorganAsh carried out was absolutely instrumental in us gaining a better understanding of the mortality profile in our pension scheme. The project was handled with enormous sensitivity and care, with members genuinely feeling that they were assisting in the better running of the pension scheme, by providing their health information. Interviews were carried out by qualified medical practitioners – with the end result being that members felt more engaged with the pension scheme and had a greater confidence in its governance. This was a very worthwhile exercise, which added value on many levels.”

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Our clients say:

We used medical underwriting to improve the valuation of our liabilities. The outcome showed a reduction in liability due to mortality of some £5m compared to the scheme actuary’s assumptions for this £40m scheme. MorganAsh carried out this delicate work with sensitivity and efficiency and the weekly progress reporting was excellent too. The payback on the investment in this project is tremendous.

Howard Jones, director of Howie Group Limited and trustee of the Howie Group Limited staff retirement benefits plan.