Pension annuities rates; retirees need help getting the best pension annuity rates. Fresh analysis on pension annuities from new boy in town, the Pensions Income Choice Association (PICA) has recommended that pension sceme providers should help retirees with their decision in picking a pension annuity product. The report, recently launched at the House of Lords, recommended that each and every retiree should be given a “personalised statement” informing them how they should go about getting annuity quotations from various annuity providers.
Retirees can then select the right annuity offering the best value and then maximise their retirement income. Recent figures from PICA suggest that only around 30% of retirees exercised their open market option (OMO) in this way during 2008. The remainder simply took the “default” option and bought a pension annuity from their pension plan provider, rather than shopping around for the best pension annuity rates, and retired on a considerably smaller retirement income. Pica’s chairman, Tom McPhail, stated that given the increasing level of competition in the retirement market it is critical that people review their options at retirement and have the chance to choose the right annuity and provider.