Police Pension Transfer Value (CETV) Explained

How actuaries calculate the figure, and why multiples vary

Scheme actuaries calculate your CETV by taking your accrued pension (the amount you've built up so far, using the 1/55.3 CARE accrual described in our Police Pension 2015 Explained guide) and working out what lump sum, if invested today under a set of standard actuarial assumptions, would be expected to be sufficient to pay that pension, with its CPI+1.25% revaluation, for as long as you and any dependants might reasonably be expected to draw it.

This is why CETVs are often expressed as a "multiple" of your annual accrued pension — for instance, a multiple of 25 would mean a CETV of £250,000 for £10,000 of annual accrued pension. For CARE schemes like PPS 2015, typical multiples tend to fall roughly in the range of 20x to 30x, though this is only a broad guide, not a formula you can apply yourself with any precision. The actual multiple used in any individual case depends on factors including your age, how far you are from Normal Pension Age, current gilt yields and inflation expectations at the time of calculation, and the specific actuarial factors the scheme's actuaries are using at that point.

Because these underlying assumptions genuinely shift — sometimes significantly, for example during periods of unusual interest rate movements — the same accrued pension can produce a noticeably different CETV six months apart. This is exactly why only the scheme administrator can issue a real, reliable figure; back-of-envelope multiples are useful for a rough sense of scale, but not for actual decision-making.

The £30,000 mandatory advice threshold

UK law requires that if the CETV of a defined benefit pension like the Police Pension Scheme is £30,000 or more, you cannot transfer it out without first taking regulated financial advice from an adviser who holds the specific permission to advise on pension transfers, granted by the Financial Conduct Authority (FCA).

Given typical CETV multiples of 20x to 30x, almost any officer with more than a few years of accrued service will find their CETV comfortably above the £30,000 threshold, so in practice this rule applies to the overwhelming majority of officers who might consider a transfer.

The adviser you use must specifically hold pension transfer permissions — not every financial adviser is authorised to give this advice, so it's worth checking an adviser's specific permissions on the FCA register before engaging them. Advice of this kind isn't free; advisers typically charge a fee for it, whether or not you ultimately proceed with a transfer, and the cost should be weighed as part of your overall decision.

It's worth stressing that this article is general information, not financial advice, and if you're seriously considering a transfer, this is precisely the kind of decision where you need a qualified professional looking at your own personal circumstances, not a generic guide.

Why transferring out of a CARE scheme is rarely a good idea

The vast majority of regulated financial advisers, when asked to advise on transferring a defined benefit police pension, conclude that a transfer is not in the member's best interest. This isn't advisers being overly cautious for the sake of it — it reflects a genuine and well-evidenced mismatch between what you give up and what you take on.

When you transfer out, you exchange a guaranteed income for life, one that increases every year in line with CPI+1.25% and comes with built-in death-in-service and survivor benefits, for a lump sum that then has to be invested and managed by you (or an adviser on your behalf) in a defined contribution arrangement. From that point on, all of the investment risk, all of the longevity risk (the risk of outliving your money), and all of the responsibility for making sensible drawdown decisions sits with you, for the rest of your life.

To replicate what the police pension already guarantees, a transferred pot would need to consistently generate returns well above inflation, survive market downturns without being drawn down too aggressively during them, and still last for what could be a retirement of 30 years or more. Even skilled professional investment management can't remove that risk entirely — markets can and do fall, sometimes for extended periods, and unlike the police pension, there's no guarantee attached.

There are also intangible factors that are easy to underweight: the certainty of knowing your pension income for the rest of your life won't fall regardless of what happens in markets, and the fact that a CARE scheme's death-in-service and ill-health protections (detailed in our Police Pension 2015 Explained guide) simply don't exist in the same form in a typical private pension. For the overwhelming majority of officers, keeping the guaranteed pension is the financially sound choice, even if the CETV lump sum on paper looks like a large number.

When transfers legitimately do happen

None of this means transfers never happen for good reason — there are specific circumstances where moving pension value out of the police scheme is a normal, sensible part of a wider process, rather than a discretionary bet on investment returns.

The most common legitimate scenario is a divorce or dissolution of a civil partnership involving a pension sharing order. Courts can order that a percentage of one party's pension, including the police pension, be transferred to their former spouse or civil partner, often into a pension in their own name. This is a legal requirement arising from the divorce settlement, not a discretionary choice about investment strategy, and the mechanics involve the same CETV calculation process even though the purpose is entirely different from a voluntary transfer-out.

Another legitimate scenario is transferring service in, rather than out — for example, an officer who previously worked in another public sector role with a similar defined benefit scheme (such as the NHS, teaching, or the armed forces) may be able to transfer that accrued service into the Police Pension Scheme when they join, under public sector transfer club arrangements, potentially building a more complete pension record. This works in the opposite direction to the CETV-and-advice process described above, and is generally a beneficial option worth exploring with your force's pension team when you first join.

Occasionally, a genuine transfer to another defined benefit scheme with equivalent guarantees (rather than to a defined contribution arrangement) might also be considered on its merits, though these situations are uncommon for serving or former police officers and would still typically require the same advice process if the CETV exceeds £30,000.

How to request an official CETV

If you do want a formal transfer value, whether out of genuine interest, as part of a divorce settlement, or ahead of taking regulated advice, you need to request it directly from your scheme administrator, rather than relying on an estimate from a calculator or rule of thumb. For most forces this is XPS Pensions, though the exact administrator can vary, so check your Annual Benefit Statement or your force's HR or pensions team for the correct contact details if you're unsure.

You're generally entitled to one free CETV statement in any twelve-month period; further requests within that period may carry an administration charge, so it's worth timing your request carefully, particularly if you're doing so specifically to support a piece of regulated advice, since the advice process itself can take some weeks.

Once issued, an official CETV is normally guaranteed for a period of around three months from its calculation date. If a transfer hasn't been completed within that window, the figure needs to be recalculated, and because it depends on the actuarial assumptions in force at the time, the recalculated figure can differ, sometimes substantially, from the original quote.

If you're only trying to get a general sense of where your pension stands, rather than pursuing an actual transfer, the Pension Calculator and Pension Transfer Value Estimator on this site can give you an indicative range based on typical multiples, purely for context — but for any real decision involving actual money, an official figure from your scheme administrator, combined with regulated financial advice where the £30,000 threshold applies, is essential rather than optional.

What to expect from the regulated advice process

If your CETV is over £30,000 and you're seriously considering a transfer, it's worth understanding roughly what the advice process involves, so you can budget the time and cost it requires rather than being caught out partway through.

An FCA-regulated adviser with pension transfer permissions will typically start by gathering a detailed picture of your personal and financial circumstances — your age, health, dependants, other savings and pensions, attitude to investment risk, and what you're hoping to achieve by transferring. They'll then analyse your specific CETV and accrued police pension figures against that picture, often using specialist transfer analysis software that models different scenarios for how a transferred pot might perform compared with staying in the scheme.

Advisers are required by FCA rules to start from the assumption that a transfer is likely not to be suitable, and to only recommend one where there's a clear, well-evidenced reason it would leave you better off given your specific circumstances. This is a deliberately high bar, reflecting how much has to go right in a private arrangement to match what a guaranteed defined benefit pension already provides. In many cases, the adviser's formal recommendation will be to remain in the police pension, even after a thorough analysis — and you're entitled to disregard a recommendation and still proceed if you choose, though many pension providers will refuse to accept an "insistent client" transfer against advice, or will require additional paperwork acknowledging you're going against the adviser's recommendation.

Advice of this kind isn't free. Fees vary by adviser but can run into four figures given the depth of analysis required, and this cost applies whether or not you go ahead with the transfer, so it's worth confirming the fee structure with any adviser before engaging them.

Weighing a transfer against your wider retirement plans

Even setting aside the strong general presumption against transferring, it's worth thinking through what a transfer would actually need to achieve for it to make sense in your specific case. A transferred pot needs to be invested and managed in a way that not only replaces the guaranteed income the police pension would have provided, but also absorbs market volatility, inflation, and the risk of living longer than expected, all without the backing of an employer or the state standing behind the promise.

For most officers, the police pension is the single most valuable asset they'll build over a career, often worth more over a lifetime than the value of their home. Treating a decision about it with anything less than the same seriousness as a major property or investment decision is a mistake many people only recognise in hindsight, once market conditions or personal circumstances have played out in a way that a guaranteed pension would have protected against.

That said, personal circumstances genuinely do vary, and a small minority of officers — for instance those with a significantly reduced life expectancy, no dependants who would benefit from survivor's pension protection, and a clear, well-considered reason to prioritise a lump sum — may have legitimate grounds to transfer after proper advice. This is precisely why the regulated advice requirement exists: not to obstruct you, but to make sure a decision this significant, and this hard to reverse, is made with full information and professional scrutiny rather than on the strength of an attractive-looking CETV figure alone.