Association of British Insurers director general Otto Thoresen admits the insurance industry will need to improve member communications at retirement as pressure continues to mount for shopping around for an annuity to be made the default.
Last month, the ABI announced plans to introduce a compulsory code of conduct which will mean that pension providers will have to remove the annuity application form from the communications they send to members.
The move is designed to stop consumers from automatically buying an annuity from their existing provider.
However, the Pensions Income Choice Association, which is campaigning for shopping around to be made the default option for investors at retirement, said the proposal “falls a long way short of what we would regard as an acceptable outcome”.
Speaking at the NAPF annual conference last week, Thoresen said: “We need to improve people’s confidence in the pension system. I think we as an industry have been guilty of having a mindset which forgets this is a decision which will affect the level of income they are going to have for 20 or 30 years.
“To make it as easy for people to get the best value possible is something we need to put a lot more energy into.
“We have taken a small step in the right direction by removing the annuity application form but there is more to do. There will be parts of the industry that find these reforms far easier to embrace than others but we have to move on.”