Futureproofing your bereavement proposition

Bereavement support and charging models could redefine the value of advice after IHT changes.

Much of the discussions around the inheritance tax (IHT) changes due from April 2027 have understandably focused on taxation, estate and wealth planning strategies to get ready for what is one of the biggest tax changes for many years.

The changes will bring unused pension funds and certain pension death benefits into the scope of inheritance tax.

But there’s another consequence that risks being overlooked.

The biggest challenge for many advice firms isn’t just the tax change. It’s the role of the adviser in helping clients to prepare for the change and – crucially – how they support families affected by a death at a difficult time in their lives.

As the taxation and processes for dealing with pension death benefits become more complex, firms need to ask whether their bereavement proposition is ready for what’s coming – because what works today almost certainly won’t be fit for purpose after April 2027.

Today, pension death benefit claims are often relatively straightforward. Advisers support beneficiaries while providers and scheme administrators manage much of the process behind the scenes. Data from our own bereavement teams tells us the average death claim process is currently handled within an end-to-end processing time of just 76 days.

From April 2027, that picture will become more complicated and the timescales involved will inevitably increase as new processes are introduced and more friction points inevitably appear.

The introduction of IHT on pension assets will create additional reporting requirements, administration duties and decision-making responsibilities. Clients’ legal personal representatives (LPRs) will be responsible for reporting and paying inheritance tax due on pension benefits, while probate solicitors will need pension information to calculate the overall estate tax position, with any available nil rate band to be apportioned between the pension and non-pension estate.

Advisers are likely to find themselves working with a much wider range of stakeholders, including family members and beneficiaries, legal personal representatives (perhaps the executor), probate solicitors, pension providers and scheme administrators. The more pensions there are, the more complex and time consuming it will be to sort out.

This is much more than a procedural change. It creates the need for an entirely different proposition for supporting families after a client’s death.

Bereavement rarely receives the same attention as other parts of an advice firm’s value proposition.

Yet after April 2027, how a firm supports a family following a client’s death may become one of the clearest demonstrations of value.

Where pensions are involved, families dealing with grief will also be navigating greater complexity, potential delays and additional uncertainty.

This is a moment of truth where advice can really prove its worth. Technical knowledge matters of course, but families remember who helped them make sense of a complicated situation, coordinated the different parties, and guided them through a difficult period to obtain the best outcomes for all those involved.

The firms that stand out will be the ones with both the technical expertise and, crucially, which deliver a clear, organised and supportive experience when families most need it.

Additionally, the FCA is currently issuing a questionnaire as part of the 2026 FCA multi‑firm review looking into how advisers, platforms and wealth managers handle bereavement cases.

The questionnaires are being used to collect information on how firms deal with clients when someone dies and are a regulatory fact‑find to test how good – or bad – firms’ bereavement processes really are, and include questions on:

• How firms respond when notified of a death
• Communication with families/executors
• How they support vulnerable customers
• Service levels/delays
• What happens to fees and ongoing charges.

Many firms will still be at an early stage in defining what their post-2027 bereavement proposition will look like. This creates an opportunity for those prepared to think ahead – and not just react to a new set of circumstances and demands when the first case happens under the new rules.

Advice firms can get started by asking some simple questions:

• What support will we provide to families and beneficiaries?
• How will we work with legal personal representatives?
• What role will we play alongside probate solicitors?
• How will communication work across multiple parties?
• What information will we gather and provide?
• What does a good beneficiary experience look like?
• Which providers do we trust and want to work with?
• How will this all be costed?

One of the most crucial questions on that list is that last one: remuneration.

Usually, ongoing adviser remuneration ceases once providers are notified of a client’s death, creating a potential gap between the service families need, and how that service is paid for.

As advisers will likely have a bigger role following a bereavement from April 2027, firms need to decide how that will be funded and how those arrangements will be explained to clients and their beneficiaries.

Defining that in advance will help avoid difficult conversations later on.

This all represents a huge opportunity for advisers to add value and protect intergenerational wealth.

Death can be the most important moment in a client and their family’s financial journey – when trust is tested and families need reassurance and guidance, and advisers who provide clarity and support have an opportunity to strengthen relationships with beneficiaries and future generations.

Futureproofing a bereavement proposition is about more than operational readiness – it’s about demonstrating the value of advice when it matters most.

A practical lesson from all this is that complexity will become more costly.

The more pension arrangements a client holds, the more complicated the bereavement process may become, with another valuation request, another provider to engage with and another timeline to manage.

That’s why pension consolidation and simplification are becoming increasingly important conversations ahead of the 2027 deadline.

No firm will have every answer before the new rules take effect. As with any significant change, advisers, providers and legal professionals will have to learn and adapt.

But there is a big difference between refining a proposition and building one from scratch.

Perhaps the biggest story around all of this change is the value of advice.

Because when families are dealing with loss, they’re not just looking for help dealing with legislation and information. They’re looking for guidance, reassurance and someone they trust to help them navigate what comes next.

The advisers who thrive after April 2027 won’t simply be the ones who understand the new rules. They’ll be the ones who are ready to support families through them.

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