AI for pensions: transformative potential, responsible use

The pensions industry is entering a new era driven by the transformative potential of AI. From enhancing operational efficiencies to delivering personalised member experiences, it is poised to play a major role in shaping the future of pensions. However, ensuring that innovation is always underpinned by strong governance and a long-term commitment to members’ interests is essential, as industry experts iPensions Group explain in this article. 

Unlocking the benefits of AI in pensions

AI is already being piloted and adopted across schemes to:

• Deliver personalised communications and retirement planning tools that help members make better-informed decisions
• Detect fraud and strengthen cyber resilience
• Automate administrative tasks, reducing costs and freeing up human resources
• Support trustees with summarised data insights and improved decision-making tools

Recent insights from the Pensions and Lifetime Savings Association (PLSA) suggest AI will become a standard part of pension fund operations by 2035.

Balancing innovation with accountability

While the opportunities are significant, the risks must not be underestimated. AI’s integration into pension systems brings critical considerations around data governance, cybersecurity, regulatory compliance, and ethical responsibility.

“The pensions sector has a unique fiduciary duty,” said Hrishi Kulkarni, Chief Technology Officer at iPensions Group. “That means AI must support human judgment. AI will deliver positive outcomes and operational resilience, but it is crucial that we maintain trust, transparency, and accountability at the core of every decision. The human element is indispensable in ensuring that AI is used responsibly and ethically, safeguarding the interests of our members.”

An industry under scrutiny

The UK Treasury Committee’s recent inquiry into the use of AI in financial services, including pensions, highlights the regulatory and ethical scrutiny facing the sector. As new frameworks emerge, collaboration between providers, trustees, advisers, and regulators will be essential to ensure AI delivers meaningful improvements without introducing new risks.

Innovation with integrity

Leading providers such as iPensions Group are actively exploring how AI can improve outcomes for advisers, trustees, and members. From automating manual processes to drawing smarter insights from member data, the group is committed to embracing technology but never at the cost of trust, security, or long-term responsibility.

“At iPensions Group, we are focused on innovation with integrity,” said Kulkarni. “We believe in AI’s potential to revolutionize the pensions industry, but its success hinges on responsible usage. By keeping humans in the loop, we ensure that AI complements our expertise and judgment, rather than replacing it. This approach helps us maintain the highest standards of trust, security, and long-term responsibility. Furthermore, the importance of data quality, accuracy and sound reasoning cannot be overstated. Accurate data and well-founded reasoning are essential for AI to deliver reliable and ethical outcomes.”