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guarantee annuity or not
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lookafterpennies
Posts: 5 Forumite

HI
In the 1980's I transferred my company pension to an insurance company offering guaranteed rates, 20 years later this was deemed to have been mi-sold and an amount added to compensate for this, now I have asked for pension projection I am told the lump sum added as compensation was added after they closed the guaranteed rates so would only receive their current annuity rate, which is very low, around 1%. Has anyone had a similar experience..
In the 1980's I transferred my company pension to an insurance company offering guaranteed rates, 20 years later this was deemed to have been mi-sold and an amount added to compensate for this, now I have asked for pension projection I am told the lump sum added as compensation was added after they closed the guaranteed rates so would only receive their current annuity rate, which is very low, around 1%. Has anyone had a similar experience..
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I am told the lump sum added as compensation was added after they closed the guaranteed rates so would only receive their current annuity rate, which is very low, around 1%. Has anyone had a similar experience..
Yes, that is quite normal. Redress is added to the excess part of the part. It has no impact on any GMP. If there were any contractual guaranteed annuity rates applicable to the excess then they would usually apply. However, if there are no GARs and only GMP then this would be the outcome you have.
You dont have to accept their annuity rate if you can get better on the open market.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
Thanks for the reply, this pension is not that big and as the redress is about a 1/4 of full amount, the bulk of the fund has GAR's at about 7% which is great but the redress attracted an annuity of about 1% as I could not split these two amounts the total amount would be averaged to about 4% which is less attractive than the headline 7% I had hoped for. but as you point out I could go else where and maybe get 4%.and be in the same position.0
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