Across the UK financial services landscape, a quiet crisis has been building for years. Millions of customers have moved home and lost touch with their pension providers, insurers, and investment managers. The assets they left behind now total a staggering £31.1 billion in unclaimed pensions alone, according to the latest industry estimates. And the problem is accelerating.
The Scale of the Problem
An estimated 3.3 million customers in the UK are classified as "gone away" by their financial services providers. These are individuals who have moved address without informing their pension fund, insurer, or savings provider. The provider has no current means of contacting them, and the customer may have forgotten the account even exists.
The Pensions Policy Institute has documented that the volume of unclaimed pension assets has grown by roughly 60% since 2018. As people change jobs more frequently and auto-enrolment creates new pension pots with every employer, the fragmentation of pension savings only gets worse. The average UK worker will hold 11 jobs over their career, potentially creating 11 separate pension pots, many of which will be forgotten.
Why Customers Don't Notify Providers
When somebody moves house, they face an enormous administrative burden. They need to update their address with the council, the DVLA, their GP, utility providers, banks, broadband suppliers, and more. Research suggests that the average mover needs to notify around 14 separate organisations of their change of address.
In that context, a pension scheme they joined three employers ago, or a life insurance policy arranged through a previous mortgage, simply doesn't make the list. It isn't a conscious decision to abandon the account; it's a natural consequence of the sheer volume of administrative tasks that come with moving home. The provider slips to the bottom of the priority list and eventually drops off entirely.
The Impact on Financial Services Firms
For providers, gone-away customers create a cascade of operational and financial problems. Every piece of returned mail costs money. Attempts to trace customers through traditional channels, such as letter forwarding or skip-tracing agencies, are expensive and have declining success rates. Meanwhile, the firm continues to administer the account, invest the assets, and produce regulatory correspondence that never reaches the customer.
The cost of maintaining gone-away accounts adds up. Industry estimates suggest that the annual cost of administering unreachable customers runs into hundreds of millions of pounds across the sector. These costs are ultimately borne by all customers through higher charges and reduced service levels.
More critically, gone-away customers represent a missed opportunity. Many of these individuals hold assets that could be consolidated, re-engaged, or cross-sold into more appropriate products. Instead, they sit dormant, generating cost but no value for either the customer or the firm.
Regulatory Pressure Is Mounting
The regulatory environment is also tightening. The Dormant Assets Act 2022 expanded the scope of assets that can be transferred to the dormant assets fund, putting pressure on firms to make genuine efforts to reconnect with lost customers before accounts are swept up.
The FCA's Consumer Duty, which came into force in July 2023, requires firms to deliver good outcomes for customers. Holding assets for individuals you cannot contact, and making no meaningful effort to find them, sits uncomfortably with the duty's requirements for firms to act in good faith and support customers' financial objectives.
Together, these regulatory shifts mean that a passive approach to gone-away customers is no longer tenable. Firms that fail to address the issue risk both regulatory scrutiny and the reputational damage that comes with holding billions in assets belonging to people they've lost touch with.
The Window for Action
The gone-away problem is solvable, but only with the right data at the right time. Traditional tracing methods rely on credit reference agency data, which can lag behind a customer's actual move by six to eight weeks. By the time the data arrives, the customer has settled in, the urgency of updating their records has passed, and the reconnection window has closed.
Real-time move data, captured at the point of tenancy agreement or property completion, offers a fundamentally different approach. By knowing when a customer moves and where they've gone within days rather than months, firms can reach out while the customer is still in "admin mode" and receptive to updating their details.
The £31 billion gone-away crisis didn't appear overnight, and it won't be solved overnight. But with the right data infrastructure, firms can start reversing the trend, one customer at a time.