More employers are outsourcing the administration of their pension plans, and they are overwhelmingly happy with the job being done by their service provider.
That's the word from Aon Hewitt's latest benefits administration survey. Aon polled 361 employers, asking them a series of questions about how they administer their pension schemes. While a year ago 69 percent said they had outsourced pension plan administration, this year, 75 percent were doing do.
And no wonder the number is rising. Plans are becoming more complex as new laws take effect, and many companies just don't have the resources on staff to easily manage the plans. Additionally, the outsourcing agencies are doing a great job — 79 percent of respondents rated their service providers as either good or excellent.
Recommended For You
Other data derived from the survey:
- Half of all those surveyed said they task their pension plan management service with additional responsibilities.
- All the small pension plan respondents outsourced multiple services to one provider, while only 14 percent of larger companies do so.
- Nearly half the defined benefit plan respondents said they had closed their schemes to new members and to further accrual.
"There are a number of other factors that are driving this rising demand" for outsourced services, said Aon Hewitt's Colin Hamilton. "Scheme administrators are facing an increasing workload driven by legislative changes, such as auto-enrolment, and meeting member expectations around service quality, engagement and online functionality, while organizations try to control costs and reduce risks."
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
