Pension providers urged to fix customer vulnerability gaps ahead of targeted support rollout

22 April 2026

Pension schemes looking to deliver the FCA’s targeted support will fall short unless they first address significant gaps in how they identify and manage customer vulnerability, support services provider MorganAsh has warned.

Targeted support will allow pension schemes to provide ‘ready-made suggestions’ to customer segments with particular characteristics. These suggestions could focus on products, certain actions or support options. The move is designed to close the advice gap, while giving firms the opportunity to offer more scalable and lower-cost support models.

However, MorganAsh has reminded pension providers that the new framework is underpinned by the expectations of Consumer Duty, warning that firms must meet the requirements for customer vulnerability management. Alongside identification and monitoring, this includes evidencing that vulnerable customers are receiving the right outcomes.

MorganAsh argues that many pension providers have limited insight into their members, beyond basic administrative records. This creates a significant challenge when trying to identify customers’ vulnerabilities or monitor whether outcomes for vulnerable customers are comparable to those of the wider customer base – which is a key expectation under Consumer Duty.

Johnny Timpson OBE, financial inclusion commissioner and chairman of MorganAsh said:

“The pension industry is well off the pace when it comes to customer vulnerability. Whilst providers and schemes have focused on the likes of training, communications and signposting, many still lack the quality data, interactive processes and oversight needed to properly identify and manage vulnerability across customer schemes. This is becoming increasingly critical as providers and schemes look to deliver targeted support at scale.

“Without that clear understanding of who their scheme members are, what circumstances they face and how they change over time, it will be extremely difficult to identify those membership segments – let alone whether targeted support is even relevant or that the right outcomes are actually being delivered. There’s no question that targeted support and its combination of scale, inclusion and low cost is hugely compelling. However, pension schemes need to get their house in order first and ensure they have a proper understanding of their membership base.”

MorganAsh warns that relying on manual processes or frontline staff alone is unlikely to be sufficient or commercially viable for targeted support. Without consistent and objective assessment, firms will be unable to gather the necessary data to demonstrate that targeted support is working as intended and that it is not causing harm.

This becomes even more critical as pension providers increasingly look to integrate AI to drive efficiencies and deliver support at scale. Without high-quality, granular data and robust systems in place, firms risk amplifying existing gaps rather than improving outcomes.

The support services provider is urging firms to adopt new guidance from the Chartered Insurance Institute on managing customer vulnerability. The document outlines a practical framework to implement the principles of Consumer Duty, and establishes the benchmark for IT systems, vulnerability classification and data infrastructure to ensure firms across financial services can identify, monitor, support and report on both vulnerability and outcomes.

Andrew Gething, managing director of MorganAsh said:

“The Chartered Insurance Institute has offered guidance that emphasises data infrastructure, monitoring, and outcomes reporting—summarised as ‘identify, quantify, monitor, support, adapt and report’. Rather than being simply process guidance, this should be viewed as the blueprint for scalable and auditable vulnerability management. Achieving this in a robust, efficient and commercially viable way requires firms to deploy digital vulnerability management, with IT systems now readily available in the market.”

MorganAsh is a specialist in Consumer Duty and customer vulnerability. The firm launched its multi-award-winning MARS platform to help firms understand and monitor vulnerable customers and deliver good outcomes – as required by Consumer Duty. It is in use across financial services and the utilities sector, enabling businesses to adopt a consistent approach to identifying vulnerable characteristics and generate an objective Resilience Rating – much like a credit score.

The MARS platform meets the system requirements set out in the new guidance, providing financial services firms with a proven tool that can be used as a standalone system or integrated into other systems via an API (application programming interface).

The guide is available for download from the CII.

To find out more about MARS or access a free trial, visit: morganash.com/mars or phone: 0330 159 8162.