The CII AF7 March 2026 Exam in Review

We’re looking at the exam guide from the CII’s March 2026 sitting of AF7 – the Pension Transfers exam. 

This article is correct as at 14 May 2026.

You can find the exam guide here.*

In this paper, Section A had a relatively low 30 marks allocated to it, and Section B had 70 marks.

Section A

The first question was a regulatory one of sorts with an interesting twist. Candidates were asked to state the information that the scheme trustees must provide in addition to the statement of entitlement. Questions regarding the content of a statement of entitlement and/or the transfer process itself have been seen quite regularly in AF7, but this was a curveball. Whilst it was only for five marks, the CII stated that those who interpreted the question correctly gained high marks, however, many performed poorly as they simply listed things that would be included within the statement. This highlights the importance of reading and answering the question asked and not simply the one that the candidate would like to have been asked.

Question 2 concerned Pippa, aged 57, who had a scheme pension including guaranteed minimum pension (GMP) benefits. This was a mini case-study which asked candidates to outline the information that an adviser would consider in respect of the GMP benefits when evaluating a potential transfer to a personal pension. GMP is a technically complex area of the syllabus given that it ceased to accrue in 1997, but this sort of question has historically come up occasionally in AF7. Performance was remarked as having been varied but broadly in line with previous sittings.

Next up was an FCA regulatory question in which candidates were asked to outline the expectations the FCA has of a firm when advising a self-investor on a pension transfer. Again, this highlighted the crucial importance of reading the question clearly and understanding the key elements. The wording of the question ought to have been a clue that the self-investor element was the main focus of this section. The FCA has previously commented that firms providing defined benefit transfer advice are expected to be aware of and take into account the assets into which any transferred funds will be invested, even if the firm is not actually advising on the investment strategy. The CII stated that the question was not well answered on the whole as too many candidates missed the real point of it.

Lastly in this section we had question 4, which introduced Nikhil, aged 56. He was considering transferring the value of his deferred benefits in order to access them flexibly to repay an unsecured loan. It asked us to state the information an adviser should obtain in respect of the unsecured loan as part of the advice process. This was a similar story, with the feedback being that well-prepared candidates who stuck to the question asked scored well, but some went off at a tangent and lapsed into general information relevant to the transfer, which would not have scored the marks.

Section B

Case Study 1

The first of our two case studies surrounded Magda, a widow who was in receipt of a spouse’s pension from her late wife’s defined benefit scheme and also had her own deferred scheme paying £19,400 from age 65. Being childless, Magda intended to leave her estate to her niece on her death. She wanted to consider buying a flat, currently living in rented accommodation. Magda had a relatively cautious attitude to risk. The case study also stated that she was considering making class 3 national insurance contributions to top up her state pension entitlement, which was a nailed-on clue even before reading the questions that one of them would cover this element.

The first question was a fact-finding one and covered the additional information that an adviser would require from Magda before making a personal recommendation as to whether she should accept her cash equivalent transfer value. This is a fairly standard AF7 question, with at least one fact-finding question always coming up in the case studies. This was only for eight marks and was answered well with the CII commenting that there were a high proportion of maximum marks.

Question 6 was a factors-to-consider one of the type which is also a staple diet of AF7. It covered the factors that an adviser would consider, based on the information in the case study, when making a recommendation on the potential transfer of the scheme. Interestingly, the CII commented that whilst the average mark was above pass standard, no candidates obtained full marks and some misread the question and lapsed into stating additional information that they would request from Magda.

The next question covered death benefits and asked candidates to state the potential options available and their income tax treatment if Magda transferred the benefits to a personal pension and immediately took her PCLS in full. This was a bit of a curveball as the death benefits payable would depend on how she actually took the accompanying pension, however, the question required candidates to cover all of the options. Death benefits are covered regularly in AF7 and again well-prepared candidates gained high marks. The CII commented that some candidates misunderstood the workings of the lump sum and death benefits allowance as well as the two-year window not applying to crystallized funds.

Finally, we had the evidently signposted question on class 3 national insurance contributions. The question asked us to list nine factors which should be considered when making a recommendation to top up the state pension by paying class 3 NI contributions and whether this should be funded from savings or the crystallized portion of her transferred funds. Whilst not directly linked to pension transfer advice, class 3 NICs are a core part of the AF7 syllabus and have come up in numerous previous sittings. The CII commented, however, that many candidates did not perform well, possibly because the second aspect to the question served as a distractor from the main substance of it.

Case Study 2

In case study 2, we met Sam and Catherine, 62 and 60, in good health married and about to retire with the intention of travelling extensively. They had two independent children and a grandchild. Both had defined benefit schemes, Catherine’s CETV being significantly larger than Sam’s. They required an inflation proofed net income of £48,000 to cover essential expenditure and £50,000 per annum for three years to cover their holiday plans. Objectives also included ensuring that the surviving spouse had sufficient guaranteed income on first death and they were mindful of care costs.

First up, we were asked to explain the benefits of conducting a cashflow modelling exercise as part of the advice provided to Sam and Catherine. Cashflow modelling is a core part of the AF7 syllabus, has been covered on numerous occasions and ought to have been money for old rope for well-prepared candidates and with ten marks available. The CII commented that it was generally well answered.

Next was a practical advice question. Candidates were provided with a recommendation, i.e. to transfer Sam’s scheme and for Catherine to take an income from her scheme without commutation, and asked to explain the reasons for it with reference to the case study. There were few real surprises here, although the model answer provided a mark for stating that there will be no reduction in her benefits as she is at normal retirement age, which was surprising. The CII state that this was generally well answered.

Question 11 covered capacity for loss and asked candidates to outline the factors they have considered in determining that Sam and Catherine have sufficient capacity for loss to transfer the benefits. This was an interesting one in that capacity for loss, whilst a core part of providing defined benefit transfer advice, is not generally tested on a stand-alone basis. However, this question offered a decent eight marks. The CII stated that it was reasonably well answered by the majority of candidates.

Last up, we had a question regarding investment strategy. Sam had accepted the recommendation to transfer his pension and candidates were asked to state the factors which would be taken into account when recommending a suitable ongoing investment strategy for the transferred funds. Investment again is a regular feature of AF7, but the CII stated that the question was not answered well overall. Many candidates stated generic factors rather than linking them to the information from the case study. This may be partly because the question did not specifically ask people to do so, but when it comes to CII case study-based exam questions, the more specific and closely linked the better.

Overall, this was a relatively standard AF7 paper with a couple of tricky little curveballs thrown in. It does highlight, however, the importance of exam technique, reading the question, answering the specific question asked and linking to the case study where relevant. These were referenced several times as reasons for dropped marks, although the CII did remark that overall performance was not notably worse than in previous sittings.

As AF7 is a specialist paper we thought it might be useful to see what has been tested over the previous papers starting with the sitting in March 2023.

We offer resources to support you as you revise for the AF7 Pension Transfers exam. AF7 has a large number of ‘staple questions’ which come up time and again in the exam paper. 

Our ‘Core Knowledge’ resource focuses on these ‘staple questions’ and includes questions, answers, detailed explanations, and cross-references to the CII study text. The resource also includes some of the core calculation questions you would be expected to understand. This is a resource that we developed specifically for the AF7 exam. 

Grab the resources you need!

If you’re studying for your CII AF7 exam, and you’re wanting to feel confident on exam day, grab our free taster to try out one of Brand Financial Training’s resources for yourself.  Click the link to download the AF7 Core Knowledge Taster now!

* The CII has updated their retention policy and now only provides the last two exam papers. Older papers referenced in this article may no longer be available on the CII website.