Aviva has improved its enhanced annuity rates service, where it provides online annuity quotes for advisers. It aims to make it easier for them to get the best retirement income for their clients. The provider has added certain medical questions to quotes which will enable it to identify clients who would get an improved income in retirement with an enhanced annuity because they have certain medical conditions. Aviva has also recently introduced automatic underwriting in respect of calculating annuity rates.

Clive Bolton, retirement director at Aviva (which was Norwich Union), said that they know clients are often confused by terms such as standard annuities and enhanced annuities and they have really looked at how to make  it easier for them. Clients shouldn’t have to ask for an enhanced annuity and the best possible annuity rate, as providers really have a responsibility to give it automatically to them. The medical questions will be added to pension maturity packs which are sent out to clients who are about to retire. This move is the latest in a line of improvements introduced by Aviva to its underwriting process.

This article is all about your annuity options; best UK pension annuity rates, etc., and how you are informed as you approach retirement. First, under disclosure regulations your existing pension company is required to send retirement option letters to you in a prescribed format, both at 5 months and 6 weeks before your Selected Pension Age. There is a summary of the options available; you can choose to 1) Take a pension commencement lump sum (PCLS, or tax-free cash lump sum), 2) Start taking pension benefits using one of the following options: (i) A lifetime annuity (typically conventional) using the Open Market Option, (ii) A short-term annuity, (iii) Income withdrawal before age 75 (unsecured pension), (iv) Income withdrawal from age 75, or 3) Not buy an annuity if you have a smaller pension funds (triviality lump sum), or 4) You could choose to do nothing if you are aged under 75.

These are a brief overview of the annuity options available. You might wish to take advice to investigate what route is best for your individual circumstances. You could take a pension commencement lump sum (PCLS); normally a maximum of 25% of your pension fund value, or the standard Lifetime Allowance if that is lower, can be taken as a PCLS before age 75. However, it may be possible to take more than this 25% figure, if you were entitled to a higher amount under previous pension plan rules. In addition to this cash sum any residual pension funds you might have must be used to provide an income from the following options.

You could start taking pension benefits using one of the following income options; (a) A lifetime Annuity using the OMO – this is an annuity which guarantees regular income payments until you die. There are a number of different lifetime annuities available. It is important to note that choosing any of these options would affect the initial income that you would receive from your annuity. If you are in ill-health or smoke, enhanced UK annuity rates might be more appropriate. 

You could take a level or escalating annuity, where the annuity income payments stay at the same level or increase each year by a set percentage, or by the RPI. Then there are guaranteed annuities, where annuity income payments are guaranteed for five or ten years. If you die within the selected period, income will continue to be payable to your estate. And there are dependants’ annuities where all, or a proportion of annuity payments continue to be paid to your spouse, partner, or dependant on your death. Whichever, it is important that you secure the best annuity rates.

With a short-term annuity you get regular income payments for up to five years. The income payments must finish before your 75th birthday. If you purchase a short-term annuity you cannot take a PCLS. With income withdrawal before age 75 you can withdraw income from your pension fund without purchasing a lifetime annuity or a short-term annuity. Under current pension rules, the level of retirement income that you can draw ranges from 0%-120% of the applicable annuity rates. The income must stop when you reach age 75. You will then have to buy a lifetime annuity or choose what is known as an Alternatively Secured Pension (ASP). With income withdrawal from age 75 (Alternatively Secured Pension (ASP)) the level of income that you can draw ranges from 55% to 90% of the relevant annuity rate, under current pension regulations. However, there are no guarantees as to how long these income withdrawals can actually be maintained, as this depends on the investment performance of the pension fund.

With smaller pension funds (the triviality lump sum) that are less that 1% of the standard Lifetime Allowance (i.e. less than £17,500 for the 2009/10 financial year) you can receive the whole pension fund as a cash sum if you are between the ages of 60 and 75, and therefore not buy an annuity. 25% of the cash sum will be tax-free and the rest will be taxed as income provided that you cash in all your pension funds within 12 months of the initial payments. And, if you are under age 75, you can choose to leave your pension alone and take benefits at a later date, providing you use your pension fund to buy some form of benefits by age 75.

Why should you consider this best UK pension annuity rates enquiry service? Well first you need to understand how the service offered is actually provided. Hopefully this, combined with other comprehensive information we’ve provided, will give you many good reasons to use our service and have the confidence that we can actually deliver. Once you have made initial contact with AEGON Direct, whether online or by freephone, the process you experience is really split down into 4 key steps. Your adviser will take the time to get to know a bit about you first and what you want from your retirement planning. In this call he or she will cover what’s really important to you and what financial planning you may have already carried out. He or she will discuss your financial circumstances, including for example, your tax position, your dependants, and what you want to achieve with your important retirement income. 

With your permission, contact will be made with your existing pension company to ask them the technical questions required to find out what type of pension contract you currently have and how that might affect the various retirement solutions and the UK pension annuity rates that can be recommended for you. This normally takes around two weeks to carry out. Not all pension companies are comfortable sending that personal information, so you might have to be asked to contact them to get the required information. 

Your adviser will call again to explain the recommendation. This will be personal to you and is designed to meet your specific circumstances, based on the details that you provide and the information from your existing pension company. This call won’t be rushed as it’s important that you understand all aspects of the recommendation. You don’t have to accept the recommendation, and you can walk away at this point. If you accept the recommendation your financial adviser makes, you’ll be sent an information pack explaining it all. If you wish to proceed with our recommendation and the UK annuity rates we find for you, it is best to complete and return the various documentation as soon as you can to try and avoid any delays as this might result in lost annuity income.

Welcome to this new improved enhanced and standard annuity rates enquiry service. At rightannuity.co.uk, our aim is to help you find the best annuity income. So, if you’re planning to retire this year, we believe we can help you with your important annuity purchase. And there’s also some good news, annuity rates have already increased in 2010. You could increase your annuity income by up to 30%, and possibly that bit more by finding the right annuity rates, and that means you receive a higher income each and every year for the rest of your life.

The service we offer you is free. We offer a free annuity quote service, whether your are looking for enhanced annuity rates, smoker annuity rates, or standard annuity rates; and their is no obligation to take up our suggestions. We’ve teamed up with a major player, AEGON Direct, to offer you this annuity service. They will provide you with annuity advice to help you find the best retirement solution, with annuity quotes from some of the UK’s leading providers. AEGON Direct is part of the AEGON Group, one of the world’s largest insurance companies with around 40 million customers around the world, and around 2 million here in the UK alone.

You can either contact us online via our free quote or enhanced annuity enquiry forms, or you can call us free on 0800 169 1256. Lines are open weekdays, 8 a.m. to 8 p.m., and Saturdays, 9 a.m. to 1 p.m. We’ve tried to make it better and easier for you to use this website. There is a lot more information about annuities, but it is easier to get around and find the information you are looking for.

Tories will scrap the current pension annuity age limit, the age by which pension annuity rates must be taken. In a move aimed at the culture of savings, shadow Chancellor George Osborne has pledged that the Tories will end the requirement to buy an annuity at age 75. This move has been broadly welcomed by the pensions industry. Tom McPhail, from Hargreaves Lansdown, argued that there was really no decent justification for forcing pension investors to buy an annuity. I have to agree with that sentiment.

An annuity, hopfully on the best annuity rates, can mean a secure income for people in retirement, they do not suit every person’s circumstances, particularly those with large pension funds. Kevin LeGrand, of Buck Consultants, described the move on the annuity age as long overdue. Having the opportunity to control your money past 75 is said to be appealing to those who do not want to convert their hard earned pension fund  into an annuity. There are a number of alternatives to doing this, such as phased drawdown (or unsecured pension). These leave retirees with much more control over where their money is actually invested and in what. There is also a higher degree of risk involved but for those who are willing to do this and can afford to bear the risk, it is probably a preferable alternative to a pension annuity purchase.