On the go: An estimated 1.6m pension pots worth almost £20bn are lost and could remain unclaimed without government intervention, according to research conducted on behalf of the Association of British Insurers.
The Pensions Policy Institute surveyed companies representing about half of the private defined contribution market, finding 800,000 lost pensions, worth an estimated £9.7bn.
The research estimates that, if scaled up to the whole market, there are collectively about 1.6m pots worth £19.4bn unclaimed. This is the equivalent of nearly £13,000 per pot.
This figure is likely to be even higher, because the study did not look into lost pensions held in the public sector, or with trust-based schemes typically run by employers.
Nearly two-thirds of UK savers have more than one pension, and changing work patterns means the number of people with multiple pensions will rise.
The average person will have about 11 different jobs over their lifetime, and the government predicts that there could be as many as 50m dormant and lost pensions by 2050.
The findings highlight the need to make the pensions dashboard a reality, the ABI said.
Insurance providers have made efforts to reunite people with lost or forgotten pensions, and in 2017 more than 375,000 attempts were made to contact customers. This lead to £1bn in assets being reunited with them.
However, in a statement, the ABI’s director of policy, long-term savings and protection Yvonne Braun said that while the industry has stepped up its efforts to reunite savers with their lost pots, “industry efforts can only go so far – we need a radical digital solution to cope with the way society is changing, or the problem will get worse”.
She added: “It is important that the government stands by its promises to take forward the pensions dashboard. This project has cross-party support, with the backing of consumer groups, and could mean a more secure retirement for millions of savers."
The Department for Work and Pensions is undertaking a feasibility report into the dashboard. In September, work and pensions secretary Esther McVey said she backs the industry to deliver the dashboard, following press speculation that she was keen to drop the policy.
