Considering an annuity with another provider. Is an IFA really needed to do this?

DRS1

chuffinnora said:

This thread is so informative and just the kind of information I was looking for.

I have DC funds in 2 places:

£500k approx in RL.
£60k approx in L&G.

If I wanted to take out a 5-10 year fixed annuity using part of my funds, and got quotes from example HL or an IFA.
What happens once I have found one, does HL or IFA transfer those funds out of my DC pots, or do I request that from them direct? Just trying to understand the process once I get to that point in time.

You will have given HL or the IFA authority to deal with RL/L&G as part of the process.  So they will have gathered some info from RL/L&G and then will have got you the quotes you need.  When you accept the quote you will send the paperwork (signed application form) to HL/IFA who will forward it to the annuity provider.  The annuity provider will then request the relevant funds from RL/L&G (possibly via Origo).  It is entirely possible that RL/L&G will want you to sign something to discharge them from any further liability to you (not sure what it says where you are transferring part and not all of your pension).

So in theory you can be largely hands off.  Of course if you're anything like me you'll be on the website or the phone every 5 minutes wanting to know what's going on.

If you are taking a lump sum at the same time as setting up the annuity (quite common) then there may be a choice of whether RL/L&G pay you the lump sum (in which case maybe another form from them for you to sign and bank details to be provided) or the annuity provider pays it (in which case they will send you the form and you'll get a different form from RL/L&G).  One of these routes is called an open market option and the other is called a full fund transfer (or something like that)