View more on these topics

FS Consumer Panel calls for non-advised workplace annuity service for all

The Financial Services Consumer Panel is calling on the Government to force employers to offer a non-advised workplace annuity service to address the “failing” market.

The Consumer Panel has today published a report into the annuity market and calling for urgent reform.

The Panel says the FCA should create a code of conduct for non-advised annuity sales focusing on disclosure of charges.

It wants to end opaque commission arrangements, which it says have grown due to the rise in non-advised sales.

It wants a rigorous market study to examine possible exploitative annuity pricing.

The Panel is also calling for the open market option to be strengthened and for the Money Advice Service to establish an annuity adviser website.

Annuities shave come into the political firing line as payments have plunged due to low interest rates and gilts.

Pensions minister Steve Webb has lashed out at the “excess profits” of annuity insurers.

Labour has tabled a series of amendments to the Pensions Bill to push for compulsory shopping around.

Consumer Panel chair Sue Lewis says the Open Market Option isn’t working and urgent reform is needed.

She says: “We are seeing a shift towards purchasing annuities via ‘non-advice’ routes, which means reduced consumer protection if things go wrong.

“The increase in non-advice sales appears to be driven by light touch regulation and higher profit margins, not consumer demand.

“We urgently need to reform this market, particularly for those with smaller pension pots, who usually can’t get independent advice. Our recommendations are intended to make choosing the right annuity more straightforward”.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com