The key change will be the ability for the insurer to provide ‘benefit based quotes’ which means that in practice a customer could specify an income they want and the insurer will tell them how much of their pension pot they need to use to achieve this. As 38% of 40 to 70 year olds say they have no idea how to work out a retirement budget, Partnership has developed its Target Income Calculator to assist advisers working with their clients on this process.
In addition, from the start of the next tax year, customers who choose an enhanced annuity with Partnership can enjoy the following benefits:
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Maximum Guarantee Period – This has been increased from 10 years to 20 years meaning that should the annuitant die, their beneficiaries can receive the income for longer;
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More flexibility over choice of dependants – Our annuitants can now nominate anyone who meets our required underwriting and age criteria* as the beneficiary;
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Value Protection –An annuitant can now leave the remainder of their pot to their dependents and this is tax free if they die before age 75. Partnership now offers quotes with value protection of any percentage up to 100% of the original premium and no restriction of the benefit at age 75.
Andrew Megson, Managing Director of Retirement at Partnership, said:
“Partnership is hugely supportive of the new pension freedoms and we have refreshed our enhanced annuity offering to ensure that our annuitants can take advantage of them. Looking to the future, we are working hard to develop a new offering which will not only be appropriate as the reforms come in but well into the future.
“While, we recognise that many wish to explore the new opportunities they have been offered, 64% of people still want a guaranteed income for life. Therefore, we are now providing benefit based quotes which mean that people can determine what guaranteed income they need in retirement and what proportion of their pension pot they need to pay for this. It might sound relatively simple but clients who understand their guaranteed income needs and provide for them will set the foundations for peace of mind in retirement.”
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