Case Study: The Financial Benefits of Effective Data Screening for Pension Schemes

Effective data screening can deliver significant financial benefits to pension schemes with a clear return on investment. While improving pension member data will certainly help schemes with readiness for the Pensions Dashboard rollout, a thorough data improvement project can also lead to significant cost savings for pension schemes. In the case study outlined here, the provider reported liability savings of £10m.

Case Study

The scheme featured in this case study had 9790 deferred members within its population. The Tracing Group were engaged to perform initial screening on this data as part of a Data Overhaul. This process highlights historic deaths that have occurred, as well as highlighting errors in the data and instances where the member was no longer residing at the address held.

The mortality screening that was performed on this data initially highlighted 139 previously unknown deaths in these deferred members – the earliest of these deaths happened in June 1985. Each month, a new screen is conducted which will identify any new deaths. In the four months since the initial screening, there have already been a further 10 deferred members reported that the scheme were not already aware of – that is 2.5 each month.

As a result of the initial findings, the provider then engaged The Tracing Group to undertake tracing on all of the members that had moved or for whom the address held didn’t appear to be correct, or was unverified. The tracing that was applied to the members who had been flagged in the initial screening as potentially gone away or unverified, also held the key to additional members that had died, unbeknownst to the scheme. There have been 49 of these cases so far.

This tracing process for gone away members has located the vast majority at their new address. This additional tracing was also essential in highlighting further cases of members that had sadly died, but had not been picked up in the earlier screening. These cases were not picked up in the screening because the member information held by the scheme had changed so much, that by the time the member died, the information held on the death record did not match any elements of the original member record.

For example, when a person moves house and doesn’t update their address, the information held by the scheme will be unlikely to match a death record fully (because of the change to the address). The screening still looks at the name and date of birth fields, so there is still a chance that a death could be highlighted. If however there has been a name change or an error when inputting the date of birth into the pension scheme system, then this data will never match an automated mortality screening. People that die overseas would never be routinely picked up through standard mortality screening. This tracing identified nine members that had died overseas – in countries including Pakistan, Zimbabwe, Jamaica, South Africa, USA, Australia and Egypt.

For further information on The Tracing Group’s tracing, cleansing and data screening services please contact 01603 937800 or visit our services pages.