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IFAs want life offices to come clean with Omo

IFAs are calling for the Government and the FSA to force providers into

making people taking out annuities aware that they can shop around for a

better deal.

By looking for the best annuity as part of an open market option, it is

possible to increase retirement income by as much as 30 per cent at

present.

IFAs believe pension companies should be compelled to tell customers of

all their choices at retirement and thatOmos should be given a much higher

profile.

Currently, a life office is only obliged to tell people of the size of

their pension fund and what income they can expect from the company&#39s own

annuity offer.

Towry Law Fraser Smith regional manager Patrick Murphy says: “Very little

is done by life offices to make people aware of Omos. It is such an

important decision. It would be crazy for anyone not to take out an Omo, as

there is only a very remote chance their pension provider will offer a

competitive annuity.”

Torquil Clark pensions development manager Tom McPhail says: “For the

Government or FSA to take action would be a very positive step and would be

in everybody&#39s interest. I would strongly support such a move.”

A recent report by the Consumers&#39 Association shows that only one-third of

retir-ees shopped around for the best annuity and that £5bn ofpension funds

are not inves-ted in the best annuity dealfor investors.

l Omo sapiens, p38

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