Doing right by customers in vulnerable circumstances

Vulnerability is a big issue for pension members – but help is available.  

How many of your pension scheme members have a vulnerability? 

It might come as a surprise that it’s likely to be around 21%, or one in five people. How do we know? We’ve got data from across Lloyds Banking Group (LBG) which indicates how many people are vulnerable, and what the main causes are.  

What causes vulnerability?  

There are any number of reasons why we might record – after we ask for their permission of course – a customer as vulnerable.  

From our LBG data on millions of customers, we know that the most common vulnerability by quite some way is financial resilience, with many people still struggling with the cost of living, lack of savings and debt.  That’s been the case for some time now. 

Second to that is people’s capability. Perhaps English isn’t their first language and they might struggle with navigating things like money and pensions. Or they have learning difficulties, low knowledge or confidence managing their money. 

Our own research from last year* shows that having a disability of some kind, whether it’s physical or a lifelong condition such as autism, or poor mental health, can seriously impact people’s finances.  

With one in two people likely to get cancer during their lifetime, it’s little surprise that health is the third leading cause, with higher heating and living costs during many types of treatment making an already difficult situation harder.  

This is followed by a life event change such as divorce, job loss, or bereavement.  

Helping customers in vulnerable circumstances  

The scale and complexity of all of this is why our customer vulnerability strategy goes above and beyond the FCA’s principles – and we’re very proud to be able to say that. 

Our customer support teams are trained in ‘soft’ skills to help them identify members who display characteristics suggesting vulnerability and speak with them in a way which is supportive, only flagging a support need on our systems if they’re comfortable with it.  

Whatever the reason, our group-wide ‘tell us once’ approach means they don’t need to get in touch with different teams.   

Bereavement is one example. Most of these notifications come via Lloyds Banking Group branches and often a family member won’t even know that their loved one had a pension. We make them aware and put them in touch with our bereavement team to ensure they receive any funds they are entitled to. 

Breaking down the language barrier  

Colleagues in our customer contact centres have, between them, the ability and skills to speak to members in around 37 languages, as part of our English Not First Language support. Where they can’t help, our Clear Voice partnership offers support in 200+ languages which we can call on in minutes. 

We’re funding Citizens Advice volunteers for our members to access so that they can quickly get advice and support when they need it. Thanks to our partnership, one member avoided having to take money out of her pension to live on day-to-day and have to pay a hefty amount in tax. Instead, she was able to access benefits she’d previously been denied.  

What really hits home for me and our colleagues who support members is when we hear directly about the positive difference we’re making to their lives.  

Winning an award on this in April isn’t about us, but it helps us spread the message so that employers and advisers know more about what we’re doing and can point people who need help in the right direction.  

There’s much more on this which you can hear about in our podcast. Scott Gunderson and Niamh Whelan talk about how we’ve created our award-winning customer vulnerability strategy. Find out more, download and listen here.  

Scottish Widows’ Be Money Well hub has resources and information to help members with a financial vulnerability, including our partnerships with Macmillan and Citizens Advice.  

*SWMT survey 2023