Friends Life is unable to offer its customers access to pension freedoms, either through drawdown or partial withdrawals, after failing to adapt its antiquated systems.
The provider has written to 1,300 customers who have requested partial withdrawals apologising for the failure. Savers with the provider who want to take advantage of the freedoms can either transfer to another provider or take their entire pot in one go.
A Friends Life spokeswoman says the insurer has received a large volume of calls from customers wanting to access their pension, the majority of which are people with small pots requesting full encashment.
However, it is unable to offer a full suite of flexibilities – including drawdown and uncrystallised funds pension lump sums (UFPLS) – as some of its older products have “complex features” which require manual work.
Friends Life says it will offer the full flexibilities “in due course” but was unable to provide a specific timeframe.
Aviva, which recently acquired Friends Life, confirms its customers are not affected by the problem.