Annuity rate transparency consultation launched

09 November 2012

The Association of British Insurers (ABI) has announced that it is launching a consultation into the transparency of annuity rates in the UK.

This comes following the publication of the ABI Code of Conduct on Retirement Choices, which was released in March this year.

Shop around

Stephen Gay, the ABI's director of life, savings and protection, stated that the organisation is committed to making it easier for members of the public to shop around for the best annuity rates at a deal that is most suitable for them as they go into retirement.

"For the first time we will be publishing rates of companies who only offer rates to existing customers as well as companies competing on the open market. Buying an annuity is one of the most important financial decisions people make and shopping around for the right one can make a significant difference to people's retirement income," he said, adding making the annuities market in the UK more transparent is a further step in helping people with this decision.

The ABI representative added that he welcomes feedback from a wide range of stakeholders and insurance companies on the annuities consultation.

Minister for pensions Steve Webb described the launch of a consultation on annuity rates by the ABI as a step in the right direction, explaining these products have to be clear and simple so they are easy to understand for consumers, adding: "I am determined to ensure that every pound put aside is turned into the maximum amount of pension."

Take advice

According to a recent report by the Daily Telegraph, it is always worthwhile for those considering buying annuities to shop around before coming to a final decision.

It noted taking some independent financial advice before making a choice about which type of product to move forward with may be a good idea, while warning consumers that there is a growing trend in the industry for cut-throat brokers to be exaggerating medical conditions in order to secure business.

Those who want more information and guidance on the right annuities for them can get in touch with the experts at Key Retirement Solutions for help and support in making a decision.