The ABI today launches further help for people approaching retirement to get the best annuity deal, with the publication of specimen annuity rates offered by its members to highlight the importance of shopping around for the best deal.
Over 400,000 people buy an annuity each year, and getting the right deal can mean thousands of pounds more income during retirement.
The publication is part of the ABI’s Retirement Choices Code launched earlier this year. This initiative aims to help people approaching retirement better understand their options and to shop around for the best annuity for their circumstances.
The ABI has published on its website specimen annuity rates offered by its members based on 12 example customer profiles. It is not a price comparison website, but is designed to show what is available in the market, and of the need to get expert advice. The illustrations will be updated regularly.
Otto Thoresen, the ABI’s Director General, said:
"Increasing life expectancy and an era of low interest rates makes the need to secure an adequate retirement income greater than ever. The industry is determined to do all it can to help people make the right decision to secure the best possible pension. The Retirement Choices Code will help people approaching retirement have the confidence to make the right pensions decision.”
The Retirement Choices Code, launched in March, will improve customers’ confidence in getting the right pension by:
- Providing clear, timely information to help people approaching retirement understand what their options are. At least two years from retirement the insurer will encourage the customer to consider their retirement options. Six months from retirement and at least six weeks from retirement the insurer will send details explaining the various options, such as combining small pots, and shopping around for the best annuity.
- Explaining the different ways to take retirement income. This will include providing for dependants, lifestyle or medical conditions that may mean they are eligible for an enhanced annuity and protecting against inflation.
- Encouraging shopping around for the right pension deal. The benefits of shopping around among other providers will be clearly highlighted along with sources of further advice. Insurers will no longer include annuity application forms so there will be less chance the customer will buy from the current provider without first shopping around.
To see the table of specimen annuity rates, visit www.abi.org.uk/annuities
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