Plans for annuity reform revealed
Plans for reform of the annuity buying process have been unveiled by the government and welcomed by the Association of British Insurers (ABI).
Both parties have expressed concern about a lack of awareness among prospective retirees around the UK as to how annuities operate and the latest plans are aimed at tackling the issue.
For its part, the ABI intends to make clear the annuity options that are available to people approaching retirement age and to highlight the fact that they do not have to take out an annuity with the same group that provided their pension.
"The market for annuities is competitive and vibrant, but not enough people are aware of all the options they have," said Maggie Craig, director of life and savings at the ABI.
"We agree [with the government] that clear information is needed when people are considering their options, in particular about their right to shop around."
A study published last month by Norwich Union revealed that around 60 per cent of people who are either retired or close to retiring would like more information about their financial options.
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