The Advertising Standards Agency has done consumers no favours whatsoever by coming down against Aviva on a complaint over one of its annuity TV adverts.
It seems it is fine for fruit companies to say you will live longer if you eat pomegranates or for credit card companies to suggest you too could be driving a speed boat around the Med. But an image of Paul Whitehouse as a pensioner clipping his hedge while saying he got “nigh on 20 per cent more income” from his pension by going to Aviva is unacceptable.
I do not often get emotional at the suffering of life insurers but it is hard not to feel sorry for Aviva on this occasion.
Anyone working in the industry will be baffled that the ASA decided Aviva was not able to persuade it of the validity of its claim. I have just been on the FSA’s website and the difference between the best and worst rates on offer among those which do the decent thing and publish their rates is 18 per cent.
I struggle to see how a single consumer can have suffered detriment at having seen this advert. If it prompted consumers to go and talk to Aviva, all well and good. If their rate then proved to be worse, the consumer will have gone elsewhere. Those that already understand the baffling concept of the open market option or the marginally less confusing shopping around for an annuity are hardly likely to not then bother on the basis of an advert like this.
Aviva seems to have come unstuck on the way the message can be interpreted. The insurer’s “we may pay you more” message has been rejected on the grounds that not enough people can get such an uplift beyond the rest of the market.
When I see a Ryanair advert telling me I can get to Stock-holm for a penny, I understand that this is the best possible deal out there, not that I am guar-anteed to get it.
We all know that what is important is that consumers understand they can get more than their pension provider is offering by shopping around. We also know that some will get up to 20 per cent more by doing so. But the ASA seems to require Aviva to be offering 20 per cent more than open market providers for it to be able to make such a claim.
With two-thirds of annuitants not exercising the open market option, for most consumers, “more” is a question of existing provider v the rest of the market, not more than the best of the rest.
Part of Aviva’s problem is it was not able to produce sufficient evidence about how much or little, non-open market providers were offering. The ASA did not accept the insurer’s argument that those not publishing their rates were necessarily worse than open market providers, which seems naïve.
Perhaps more surprising, given the many hours of energy that certain corners of the industry have put into demonstrating the benefits of the open market option, Aviva was not able to get its hands on data to demonstrate non-open market providers’ rates.
That does not get the ASA off the hook. We know telling consumers they can get more by shopping around does not work. Consumers need clear, simple messages and the ASA’s decision in this case will only serve to make providers water those messages down.
The reality is Aviva’s claim that it can get you up to 20 per cent more is absolutely true. It is telling that the ASA case was brought on the basis of just four complaints. I wonder how many of them work for competitors?
John Greenwood is editor of Corporate Adviser