From tomorrow, 1 March 2018, all pension providers offering an annuity option to scheme holders will be required to show a market comparison alongside their offer, allowing consumers to judge whether they are being offered the best package.
National IFA, LEBC The Retirement Adviser, has advocated this new directive as it promotes the benefits of shopping around, whilst also improving consumer awareness within the market.
LEBC director of public policy, Kay Ingram, commented: “ While the perception is that annuities are a thing of the past, and not good value for money, we have seen the annuity take up increase with sales up 26% in 2017 compared to 2016 which itself saw a 10% increase on the previous year”.
LEBC hosts a team of specialists that are able to explore all the options available to those looking for a long-term, secure income.
The specialist team uses consumer’s medical history and other lifestyle factors such as alcohol consumption, smoking history, occupation and family history to ensure that their customers are offered the best package. LEBC claims that “enhancements can be as much as 30% extra income if the right questions are asked and presented to annuity providers in the right way”.
Ingram said: “Our very thorough investigation process which leads 70% of our clients to obtain enhanced terms and also a trend for older clients, having experienced drawdown in the earlier years of their retirement, now seeking more certainty of income in later life.
“Unfortunately self-service websites and even some IFAs do not explore these options thoroughly enough and so too many retirees fail to make the most of their retirement income, as highlighted in the FCA’s retirement outcomes review.”
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