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What are we each entitled to in our divorce settlement?

What does the law say about how to split the house, how to share pensions and other assets, and how much maintenance is payable.

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Pension in payment

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26 Mar 08 #17690 by OHPPS
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When a pension in payment is valued for "divorce purposes only" what does this mean ? is this an undervaluation or a market valuation ? All comments would be appreciated. Especially regarding offsetting

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26 Mar 08 #17697 by Elle
Reply from Elle
Hi Val1,
There are lots of pension queries and answers regards pensions in previous posts which u can access via the search link. Hope this helps whilst u wait for replies
Elle

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26 Mar 08 #17704 by Peter@BDM
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Val

The main reason why it says “for divorce purposes only” is that ordinarily you cannot alter a pension in payment. For example, it cannot be transferred or surrendered (nor can it be assigned). There are very few exceptions to the rules, and divorce dissolution is one of them. You can share or attach a pension in payment (although these sound the same, they are quite different).

The valuation you receive (a Cash Equivalent Benefit – C.E.B.) is not a market valuation, it is merely the valuation placed on the pension by the pension scheme. In broad terms, a CEB is likely to undervalue the pension. Independent actuarial valuations (market valuations) can be obtained and are often reasonably affordable. Whether the appropriateness of the valuation is an issue for you will depend upon the following:

• Whether the pension is yours or your partner’s
• Whether the person receiving the pension is in average heath for their age
• How the pension is to be re-distributed (shared, attached or offset)

Peter.

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27 Mar 08 #17815 by OHPPS
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Peter
Thanks for the reply

The pension is my ex`s
His health is a contentious issue
The valuation will be used for offsetting purposes

I was under the impression from his solicitors that it had gone to an actuary for valuation I have however not seen an actuarial report only a letter stating the valuation from the pension scheme office.

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27 Mar 08 #17819 by Peter@BDM
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Val

Thanks for the information, which helps a lot.

It could be that the valuation has been done by the pension scheme’s actuary; in which case it is not an independent valuation and it is likely to under-value the pension. The alternative is to obtain an independent actuarial report but depending on the size of the pension, the cost may not be justifiable. You say that health is a contentious issue. If he is in poor health, to an extent that is likely to have an impact on his life expectancy, that should be taken into account in any independent actuarial valuation. Any significant health issues will reduce the value placed on the pension, which is not in your interest if you are aiming to offset! It is most unlikely that the scheme actuary will have considered his health when doing the standard (Cash Equivalent Benefit) valuation for divorce purposes. Which rather suggests that in your case you should use the CEB for offsetting purposes.

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