The Money Advice Service enhanced annuity comparison tool is failing to produce quotes from two of the UK’s largest providers.
The MAS annuity comparison tool allows users to input lifestyle and medical conditions in order to obtain tailored quotes from a range of pension providers.
However, when Money Marketing tested the tool for a 65 year old male with a £100,000 pension pot who smokes 30 cigarettes a day, it did not provide rates from Just Retirement and Partnership, two of the largest enhanced annuity specialists in the UK who often offer some of the highest rates.
The MAS tool only quoted annuity rates from Aviva, Canada Life, Hodge Lifetime, Legal & General, LV=, Prudential and Saga.
According to Annuity Direct, a 65 year old man with a £100,000 pot who smokes 20 cigarettes a day and has high cholesterol and high blood pressure could miss out on £400 per year in retirement income if they use the tool to shop around for providers.
This is because Partnership, one of the providers which is not quoted by the MAS tool, would offer the best rate in the market for this individual.
A MAS spokeswoman says the problem originates from the wholesale provider it uses to collect annuity rates from across the market. It is unclear when the fault will be fixed or when the problem started.
Following Money Marketing’s exposure of the flaws this morning, the MAS says it will now add a message to the front of its annuity tables highlighting that they represent information from a panel of providers and do not cover the entire market.
The MAS spokeswoman would not confirm the identity of the wholesale provider it uses for the service.
MAS chief executive Caroline Rookes says: “Our in-depth annuity guides reiterate as strongly as possible that because choosing an annuity is a decision that will determine your income for the rest of your life, you should get help from a financial adviser or specialist annuity broker, unless you are confident to do make your decision alone.
“When our annuity table generates quotes for the customer we also let them know our tables represent information from ‘panel of providers’ which do not cover the entire annuities market. To clarify this point even further we are now adding this message to the front page of the annuity table itself.”
“The process of collecting comparative data for financial services products is complex, and the data we serve to customers is collected for us by a third-party – a wholesale data provider. This is the case for most online comparison tables in the market. The annuity quotes we serve customers are created-on demand, using data pulled from the wholesaler’s information, the results are ‘bespoke’ for each customer who uses our tables.
”We want our annuity comparison tables to be as comprehensive as possible, but we are aware that data from two annuity providers is not provided to us from the wholesaler. We are working to try and include the extra information, and hope to offer at data from least one of the two providers very soon.”