Pension annuity: the open market option
Pension annuities are important. The decision about which annuity to buy and what annuity rate to go for are important. That is why advisers have a distinct role to play when advising about the Open Market Option (OMO). Are consumers, including you, educated properly to respond to annuity providers letters.
Unfortunately consumers, even when properly prompted, are ignoring the annuity related Open Market Option. This only emphasises the importance of utilising the expertise and market options available to an adviser to ensure consumers are best served in retirement. Advisers now have a distinct opportunity to provide their clients with a comprehensive analysis of their situation and develop a retirement solution that best suits the clients’ requirements.
It is probably fair to say that whilst advisers should consider the OMO option with their clients, the majority of clients are unlikely to have the skills and knowledge to understand why they should consider it and whether they should invoke it.
