Standard Life is offering its own pension customers a higher standard annuity rate.
The provider has contacted advisers notifying them of improvements in the standard annuity rates offered to existing Active Money Sipp, Wrap Sipp and Pension Fund Withdrawal Plan customers.
The offer is only being made to customers who have been with Standard Life for over two years.
In an email sent to IFAs, Standard Life says: “We’re aware some customers are seeing a significant fall in the income they can take from their drawdown pension. Because of this, some of these customers are choosing to take an annuity due to the certainty of income it provides.
“To help our customers and to show our appreciation for their loyalty, Standard Life is offering market competitive annuity rates to make it easier for them to annuitise with us.
“These improved rates are only available to customers who have held our Active Money Sipp, Wrap Sipp or Pension Fund Withdrawal Plan for two years or longer and are competitive compared to standard annuity rates.”
Standard Life head of decumulation propositions Alastair Black says: “It is common practice for people in drawdown to lock their pension into an annuity.
“We would encourage any customer to speak with their financial adviser before making the decision on annuitising. If it’s the right decision to switch, our offering will ensure they are able to make a smooth and easy transition from one income source to the other.
“We will seek to offer rates around the top of the market, where we can.”
The Retirement Partnership director Billy Burrows says: “I have always said that insurance companies should find a way of rewarding clients who invest with them so it seems like good news from Standard Life.
“Investors in drawdown have suffered a double whammy as a result of falling gilt yields and the reduction in maximum GAD, so it is understandable that many are considering bailing out and buying an annuity instead.”