Insurers, professional bodies, guidance services and financial advisers have revealed what they will do to support Chartered Insurance Institute-led initiative Insuring Women’s Futures.
Action being taken to equip and empower women to improve their financial futures includes:
- Government will be lobbied for changes to auto-enrolment, pension freedoms and sharing rules to make sure the gender pay gap, motherhood, caring and relationship breakdowns do not create impoverished female pensioners in the future; and
- Insurers have committed to offer flexible working and to develop inclusive practices for all consumers in a move to improve women’s financial futures.
The initiative has brought together 150 financial services professionals to collate data and form a plan of how to improve female financial resilience.
It has explored the financial decisions women of all ages are having to make and the way they are currently penalised when it comes to the pound in their pockets compared to their male counterparts.
At an event in London, Insuring Women’s Futures detailed what further work – such as employers being required to disclose gender pension contribution gaps to inform improvements to pension scheme design – needs to take place to improve women’s financial resilience.
Other recommendations outlined by the Insuring Women’s Futures initiative are:
- Equipping young women to make financially informed study choices;
- Including the employer’s pension contribution in gender pay gap reporting;
- Setting out a strategic priority for financial guidance bodies to promote gender inclusive financial engagement and wellbeing approaches;
- Creating a national conversation around care including carers’ pensions;
- Collecting and using gender disaggregated data to inform policy and supervision;
- Use of the themes of Insuring Women’s Future’s Financial Wellbeing Guide by guidance providers;
Jane Portas, co-founder of Insuring Women’s Futures, said: “By focusing on key moments that matter interventions across the female financial Life journey, together we have the power to make practical, meaningful and lasting change.
“These cross-cutting recommendations present an opportunity for each and every one of us to act in the moment that matters and by doing so we will all benefit from change.”
Female pensioner poverty
The Insuring Women’s Futures initiative has also unveiled a list of measures the government, regulators, financial services providers, guidance services, financial advisers and employers must adopt to end female pensioner poverty.
- Auto-enrolment earnings eligibility limits should be reduced and Net Pay Schemes should be amended to provide tax relief for low earners;
- Shared parental leave rights and pay should be equalised. Too many women are currently suffering a pension penalty because they take on the bulk of family care;
- Spousal consent should be required in relation to defined benefit transfers to ensure dependents are engaged in the decision;
- The law should be changed to make pensions sharing the default position. Pension scheme rules should be changed to allow an ex-spouse to continue to participate;
- To improve access to advice, the government should allow the Pensions Advice Allowance to be used for divorce;
- Pensions valuations should be simplified through standardisation and made more meaningful to support longer term decision-making;
- Employers should be required to include employer pension contributions as part of gender pay gap reporting and to disclose gender pension contribution gaps to inform improvements to pension scheme design, participation and pensions wellbeing in the workplace; and
- Where employees are changing working arrangements, employers should prompt staff to consider the impact on their financial future.
Engage and empower
Sian Fisher, chair of Insuring Women’s Futures and chief executive of the CII, said: “We know some of the issues needing to be addressed are deep-rooted and will take time to have full effect.
“We need to empower people to come together to talk about their financial life.”
Keith Richards, chief executive of the Personal Finance Society, said: “The Personal Finance Society has pledged to engage policymakers on the change required and recommendations stemming from the latest IWF work, in particular regarding the retirement provision deficiencies.
“It is time to better engage everyone in how to take charge of their financial future.”
This story originally appeared in International Adviser, a Last Word publication.