13th August 2014
Insurer Royal London has launched what it is describing as an annuity bureau for its four million direct pension customers.
The UK’s largest mutual insurer previously had a single tie up with Prudential which saw customers offered annuities from Prudential if they didn’t make another active choice, though they have always been free to source an annuity on the open market.
The new service will offer customers annuities from what the insurer says at 10 leading annuity providers. Royal London says the firms represented provide 99% of the annuities bought in the open market.
Royal London argues that despite the budget changes to pensions, which means people have many more options than buying an annuity, annuities remain a good option for many people.
Phil Loney, CEO of Royal London Group, says:“Every year thousands of our policy holders reach retirement age. Recently the number of people taking cash has doubled, and we anticipate this trend to continue. Many people are likely to take the cash element whilst keeping the rest of their pot invested, and consider taking an annuity later in life.”
“It’s vital people make the right decision when purchasing an annuity – it is a crucial, irreversible decision which affects their income for the rest of their lives. I urge all our direct, non-adviser customers who are approaching retirement to make time to use our new service so they get the right type of annuity, with the highest income available to them.”