Key responds to FCA retirement income market data

08 January 2016

Comment from Dean Mirfin, technical director at Key Retirement, on the findings from the latest FCA Retirement Income Market Data: "Shopping around is not working with nearly two out of three annuity customers sticking with their existing provider and 58% of drawdown customers not moving.

"It is a major worry that the launch of pension freedoms seems to have sent all the work on shopping around for the best deals into reverse and means thousands of savers are missing out on vital extra income simply because they are not looking for the best or most appropriate deals.

"The FCA figures show that many are not taking advice - just 17% in the latest three months used Pension Wise and less than two-fifths of annuity customers used a regulated adviser. Even in drawdown 42% did not take advice.

"In its thematic review of annuities in February 2014, the FCA found that 80% of consumers who purchase an annuity from their existing provider would have ensured a better deal by shopping around. Much more needs to be done to raise awareness around the benefits of seeking out the best deal as well for seeking advice to ensure the best outcome for those at retirement."