Annuities Advice

Raylap1705

Re: Annuities.
Would welcvome any advice on the following.65 in Nov and have to purchase an annuity. My pension pot is a section 32 Buy Out with Norwich Union since 1988, worth about £80000 before any tax free sum taken. The annuity they have offered is not as good as one offered by Aegon Scottish Equitable.Dont know much about SE so would like to know if they are a good company to go with especially at the present time?
Banks have suffered and some insurance companies have also suffered last week.SE also appear to have had money with some Icelandic Banks. Will my annuity be safe with SE and what guarantees do I have have if they go bust etc.
Any advice will be welcome and many thanks

dunstonh

Dont know much about SE so would like to know if they are a good company to go with especially at the present time?

Scot Eq have improved their prices but they are usually beaten each time by others. Especially the companies you can haggle the price with (you cant but your IFA can).

Will my annuity be safe with SE and what guarantees do I have have if they go bust etc.

You get at least 90% protection under the FSCS insurance scheme.

Any advice will be welcome and many thanks

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EdInvestor

It would be interesting to hear how the OP's quotes compare with the ones currently on the regulator's website:

www.fsa.gov.uk/tables (Go to Pension Annuities section and input details).

We are often told these tables are out of date, but does it make much difference, if so?

dunstonh

We are often told these tables are out of date, but does it make much difference, if so?

If they were accurate then IFAs would use them. We cant even use our own quote portals reliably due for much the same reasons. The problem with the FSA tables is that the assume standard retail pricing and make assumptions. They also get the data feed at certain points even if prices update in between. One provider on there us using Aug 07 prices.

At the moment, IFAs can play a few insurers against each other to haggle the terms. That is on top of the individual terms that networks have negotiated beyond the normal retail.

The differences may only be 0.1 or 0.2% but then you also have the companies that only deal with IFAs or dont make their figures available on the FSA website.

dunstonh

I am doing an annuity at the moment so I thought I would just see how the FSA tables come out.

1 - No Norwich Union or Pru. Two of the biggest and two that often come out best.
2 - No option for frequency
3 - No option for advance/arrears
4 - No option for with or without proportion
5 - no option for with or without overlap
6 - no option for protected rights
7 - assumes one pension source and not multiple
8 - only 8 providers on the list. Already mentioned no NU and Pru but other key providers missing as well.
9 - Age is shown in years only (i.e. 60,61,62,63,64,65 etc). Annuities are priced upto daily with some provdiers although monthly or quarterly pricing is more common (i.e. 65 and 3 months)

The company that came top on the FSA tables was actually 3rd when you get real figures. And that is before I get the broker consultant to give me better offers. The best price will be about 3% better than the FSA table shows on like for like basis. With the required frequency and options that will go up to around 5% better than FSA tables.