Heath Lambert has teamed up with Partnership to launch an online, direct to consumer annuity service targeting individuals with small pension pots.
The service, which will be offered exclusively to Diabetes UK members for the first three months, allows people to shop around for an annuity from a list of 10 providers comprising Partnership, Just Retirement, LV=, Hodge Life, Living Time, Prudential, Aviva, L&G, Canada Life and Aegon.
The online platform is underpinned by Partnership’s medical underwriting system, with users asked 11 questions to determine whether they qualify for an enhancement on their annuity. Advice will be available to those who request it.
Heath Lambert will pay Diabetes UK commission for each member who uses the service to purchase an annuity. The charity says the payment will not result in additional costs to the investor and will provide it with “valuable revenue”.
Heath Lambert director Stuart Grennan says the system is the first of its kind in the UK.
He says: “It is remarkable that leading pension providers have effectively got away with the status quo for so long. The majority of people at retirement in the UK do not trawl the market for the best income when converting their funds into an annuity.”
Research from Partnership suggests around 70 per cent of people with a pension fund worth less than £40,000 fail to shop around for an annuity.
Managing director Andrew Megson says: “There is a compelling need to change consumer behaviours and I believe Heath Lambert’s system has the potential to do this.
“It puts the customer first by simplifying the annuity purchase process and provides immediate quotation and transaction capability.”