Annuity shock

Sagwala

I understand there are compensation routes that can be followed similar to missold ppi? Any thoughts

bmm78

sagwala wrote: »

I understand there are compensation routes that can be followed similar to missold ppi? Any thoughts

Based on previous FOS rulings for provider annuity sales, there is virtually zero chance of any compensation through that route.

The FCA are investigating historic annuity sales, but only back till 2008, and there is no clear indication as to what (if any) action they are likely to take.

uk1

sagwala wrote: »

I understand there are compensation routes that can be followed similar to missold ppi? Any thoughts

I think dunstonh's reply to you earlier was really well balanced and informative and it seems to me in agreeing with that post that you decided to consult a company selling it's own products rather than taking a more independent path. His point that you were uninformed rather than iincorrectly informed seems right. dunstonh's reply might not be what you wished to hear but to me is seems right.

You chose not to seek independant when with the benefit of hindsight you may have needed it.

We all do it ..... sympathies.

Jeff

dunstonh

Sympathies sagwala, unfortunately you were taken in by a financial institution, salesman probably, who didn't explain what was happening, so now some many years later you're somewhat screwed.

Get off your high horse and look at what has been said rather than making things up to suit your agenda. He didnt use the open market option. No "salesman" called. Shame as had a "salesman" been used, then the terms would have been better.

The normal enhanced annuities are for type 2 diabetics, aren't they?

Type 1 diabetics are totally different but I must admit I do not know what the difference in life expectancy between type 1 and type 2 (my wife is type 1 diabetic).

The criteria for qualifying for enhanced annuities today would cover both type 1 and 2. Indeed, it is really easy to get an enhanced rate nowadays (although the enhancement will reflect the severity of the condition)

However, the time to be looking at this is point of purchase. Not years after the event. These contracts are cast in stone currently.

I understand there are compensation routes that can be followed similar to missold ppi? Any thoughts

As no-one sold you anything, how were you mis-sold? Effectively, you mis-bought.
It is a bit like walking into an Apple store, being sold an Apple Iphone and then a few years later complaining you the Apple store didnt sell you a Samsung Android phone. If you are not up on phones then think of it as similar to going into a single brand shop, buying that branded product and then complaining years later they didnt sell you someone else's brand.

As mentioned above, later cases do get greater consumer protection as the requirements on offering enhanced terms and pushing the open market option harder increased over the years and there was a standard in place by 2008. Some providers may have been lacking on those standards and that may give in a look in for some post 2008 purchases that were not done via an adviser. However, yours pre-dates it.

On the upside, your annuity rate is almost certainly much better than one bought today.

mania112

As it happens £400pm on £81k is a pretty nice return from age 55.

You've already had £48,000 and you'll soon be in profit. Not bad for a guaranteed return. (all depends on your health of course, i'm not sure what your life expectancy is, but hopefully you're looking after your Diabetes ok)

EDIT: I would say your annuity is enhanced for your medical condition, by the way. Your GP could have been contacted for this information.

AnotherJoe

mania112 wrote: »

As it happens £400pm on £81k is a pretty nice return from age 55.

You've already had £48,000 and you'll soon be in profit. Not bad for a guaranteed return. (all depends on your health of course, i'm not sure what your life expectancy is, but hopefully you're looking after your Diabetes ok)

I agree, despite the OPs complaint, and through sheer ignorance of what he was buying, he's probably better off having bought an annuity than had he just invested the money and taken drawdown, which it seems he wasn't eligible for anyway. He's getting about 6% return, which is better than most would get from the stock market, especially with the couple of major corrections since then.


He would likely have got a better annuity rate had he shopped around, but even now with all the publicity apparently about 50% of annuity purchasers dont shop around, so there was nothing unusual about it back then. The only compensation due would be against his younger self for not taking a few minutes to learn what the heck he was buying.

atush

sagwala wrote: »

Thank you an informed response. What about getting a higher income due to being diabetic?

This is 100% when you should have used (and for anyone reading Shoudl use) an IFA. AS they can look over the entire market, haggle on your behalf, and get you far more income for each quid you had/have. And their advice/payment would be less than the increase in come you would have gotten.

So for anyone else, this is where the OP went wrong. Any health issues AT ALL, then use an IFA to find you the best enhanced annuity (if annuity is what you need/want.


And I remain convinced, given the lack of knowledge of the general public in both options and investing, that using annuities will be the best deal still for many.

macca1974

another vote to suggest that you probably got a pretty good deal. If you consider for a second that you believe that you should have been in a drawdown (the only option where you would have a residual value) then you would have been investing just before the financial crash in 2007/2008. because you were drawing a pension, then this would have had a negative impact on your capital value and I reckon if you'd maintained withdrawals of £400 per month, then you'd likely have 30-40K in the pot rather than 60K (depending on how you'd invested).

Current annuity rates for 65 year olds would be around 6%, so you'd only be looking at an income of around £2-3K per annum rather than the almost £5K that you currently have.

I suspect that rather than complaining, you might want to thank Standard Life instead (although you'd have probably done better through an IFA as you'd have been able to take advantage of some advice on the best annuity rate available at the time).

coyrls

sagwala wrote: »

Naively, or perhaps misinformedly, I was under the impression that this money was being given paid on the basis of profitable investment from my collateral. I always had in mind about a 60k approx further drawdown when I retire.

I don't believe you.

atush

macca1974 wrote: »

another vote to suggest that you probably got a pretty good deal. If you consider for a second that you believe that you should have been in a drawdown (the only option where you would have a residual value) then you would have been investing just before the financial crash in 2007/2008. because you were drawing a pension, then this would have had a negative impact on your capital value and I reckon if you'd maintained withdrawals of £400 per month, then you'd likely have 30-40K in the pot rather than 60K (depending on how you'd invested).

Current annuity rates for 65 year olds would be around 6%, so you'd only be looking at an income of around £2-3K per annum rather than the almost £5K that you currently have.

I suspect that rather than complaining, you might want to thank Standard Life instead (although you'd have probably done better through an IFA as you'd have been able to take advantage of some advice on the best annuity rate available at the time).

While i agree with t he above re DD and the timing- I do think they could have increased their income dramatically had they gone for an enhanced annuity due to the underlying health conditions.