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GE Life extends annuity guarantee period amid rate fears

GE Life is extending its annuity quotation guarantee period from 14 days to 30 days amid concerns that the distance marketing directive could hit annuitants’ rates.

The directive, which came into effect this month, has increased the cancellation period for life and pension contracts from 14 days to 30 days.

Income from annuities cannot be paid until the post-sale cancellation per-iod has expired, which has raised concerns that customers may suffer from any falls in annuity rates if they dip during this period.

Under the directive, GE Life is offering a 14-day pre-sale right to withdraw and a post-sale cancellation period of 16 days to meet the 30-day requirement.

To remove confusion, it is also applying the terms across all distribution channels despite the fact that ext-ended cancellation rights only apply to distance sales.

Chief executive Scott Dolfi says while the group believes that added consumer protection is a plus, it should not be at the exp-ense of annuity rates.

Dolfi says: “The directive increases the possibility that customers could suffer from a drop in annuity rates during the cooling-off period because providers are unable to complete the contract. By extending our annuity guarantee period, we are protecting our customers from this risk.”

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