Certain life offices are suggesting that the Financial Services Authority’s (FSA’s) annuity tables are somewhat misleading. Ahead of the pack are Prudential, who suggest that the FSA should actually scrap individual providers’ listings of annuity rates on its Moneymadeclear website, arguing that the information is inaccurate.
Their annuities business director, Karin Brown, states that the FSA should simply provide straightforward information as to where retirees can shop around effectively for the most appropriate retirement options and the best annuity rates, and that currently this is not what the FSA’s website is doing.
The FSA’s Moneymadeclear website, which annuity providers are required to refer retirees to in their retirement wake-up packs, does not include postcode annuities or enhanced annuities in its annuity rate tables, although it does list the providers of these products on the side of the web page.
Brown believes that retirees are contacting the annuity providers at the top of the annuity tables, assuming that the FSA is searching the whole of the market. She also suggests that people are failing to consider different types of retirement options, which just might be better for them.
Brown states that the FSA is not really doing a good job at enabling retirees to shop around for the best annuity quotes. People believe the website offers the whole package of solutions when it does not, and this view is backed up by Norwich Union’s head of annuity marketing, Darren Dicks, who says that the website is generally misleading and it is not clear that it does not scour the whole market for an annuity quote, which is what retirees expect from the FSA.
Instead of scrapping the annuity tables altogether, the FSA could provide an example of both an average annuity rate and a competitive annuity rate without listing specific providers. This would probably encourage retirees to use advisers to look for retirement options.
The FSA have responded to all this, suggesting that the website is a comprehensive and up-to-date tool for retirees, and that it provides a complete set of information to enable them to compare annuity rates across the market in an impartial, non-selling form of environment. If individual annuity providers have concerns, they suggest they should contact them directly.
