Has the ABI cracked the annuity code?
Great news, the ABI (Association of British Insurers) have now launched their code of conduct. This will help to educate those 1/3 of people who still do not get advice and search the entire market for the most appropriate product and rate when they come to retire. The code will hopefully stop those who have saved for 30 or 40 years rolling into their current pension providers offering on the day they agreed to retire years ago with no thought about if that is the best option. With annuity rates at a low-level and products around which could be a better option advice, review and thought must be the way forward.
So the code of conduct makes sure customers will have access to the information that will allow them to make an informed decision. It requires providers to give their customers clear and consistent communications and to signpost the fact that they can shop around for the most appropriate product. They also have to explain the benefits of enhanced annuities and if they offer them and point out where advice can be found both from government sources and financial advisers.
Other changes the code is implementing are to stop providers including application forms in the retirement packs they send to customers and forcing them to publish their annuity rates to aid comparison and transparency.
Author: Robert Trapnell- Right Retirement
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