Is it legal for insurance companies to operate post-code annuities?

MarkyMarkD

bigbloke45 wrote: »

If, as I suspect, not many! then it seems to me that NU and others are cynically reducing annuity rates and blaming it upon low life expectancy in areas that don't actually have pension annuities in the first place.

Sounds a little like Mr. Brown and his lackeys to me!

The ability of insurers to "cynically reduce annuity rates" is entirely down to the market - and because there's a competitive market for annuities, they don't really have the power you suggest.

Pricing annuities more realistically can only be fairer, as the previous system involved huge subsidies from those who were likely to die earlier (usually the poorer) to those who are likely to have long lives (usually the better off).

And I know those are huge generalisations, but to an extent they hold true.

dunstonh

I checked with NU and they confirmed that the postcode is not mandatory. However, it will be assumed that the healthiest post code applies in those cases.

They have not lowered annuity rates for healthy postcodes but only increased rates on less health ones.

MarkyMarkD

So, contrary to the conspiracy theory put forward by bigbloke45, NU are actually giving money away to those who would otherwise get a raw deal - those who are poorer (generally) and in poorer health. Well done, NU.