Despite recent market volatility, expected redress payments arising from defined benefit (DB) transfer advice remained broadly stable during the second quarter of 2025, according to First Actuarial’s Redress Tracker

The tracker found that the likely redress on a book of DB transfer advice remains below 5 per cent of the total transfer value, despite market volatility during the quarter.

The tracker, launched in February, aims to allow First Actuarial to predict more accurately how a firm’s total DB redress liability will change over time, tracking the typical redress payments arising from a portfolio of notional individuals who transferred out of their pension scheme.

First Actuarial associate partner and head of redress services, Sarah Abraham, said that the stable redress levels seen in Q2 will benefit advising firms, suggesting that this is "more good news" for firms that have written DB transfer advice.

“When there isn’t enough information on file to calculate redress, it’s sometimes necessary to contact the ceding DB scheme to fill the gaps,” she said.

“Many independent financial advisers worry about markets moving against them while they wait for a response, so it’s good news to see redress remaining low again this quarter.”

However, Abraham warned that whilst compensation payments in most cases will be a fraction of those a few years ago, redress payments remain “highly” sensitive based on the specifics of individual cases.

Given this, she cautioned advisers against assuming that redress will always be low.

“We still see substantial redress in certain circumstances, for example where the defined contribution (DC) pension has performed poorly or the transfer value paid was low,” Abraham added.

“Firms need to bear this in mind when they receive a complaint, and make an informed decision about how to proceed.”

First Actuarial previously suggested that the ongoing review of the financial ombudsman service (FOS) offers a "significant" opportunity to rebalance the relationship between consumers and advisers in pension redress cases, calling for a "fresh approach" to assessing whether to uphold complaints about pension transfer advice.

---