Trying to buy an annuity

Retired_in_Crete

Not strictly a money saving question but as I live in Crete I do need help.

I have two modest private pension plans which, although I am not yet 65, I have decided to use to purchase an annuity. Every 6 months or so I have obtained a valuation of the plans and up until last June they were showing growth. The valuation I got in December showed that the value had declined and as I can see no increase in the stock market in the forseeable future ( although I may be wrong) I have decided to take the maximum tax free sum and draw an early pension.

When buying an annuity you are advised to "shop around" for the best deal. This is where the problems start. You cannot deal direct with the pension provider, you have to go through a Financial Consultant. To my knowledge there are none of these on Crete. A Google search lists a number of companies who will give an on-line quote and suggest that the pension from XYZ will be the best for you. They will then sell you that scheme and pocket their commission. However, all those that I have tried ask for a UK address and postcode. I live in Crete, I have no UK address. I have used my sons address to obtain a quote but when I telephoned the company to buy from them they refused to deal with me as I don't live in the UK. They quote money laundering regulations as the reason for this even though my plans are with a British company, I want to buy an annuity from a British co and I want the pension paid into a UK bank account.

The only way forward that I can see is to use my sons UK address. However I suspect that Norwich Union, who hold my pension funds, will not release the cash to the pension provider as they know that the address given is incorrect as they are aware that I live on Crete. I expect that they will quote "prevention of identity theft" regulations to with-hold the funds.

Any suggestions as to what I should do?

John

dunstonh

As from the 1st Nov 07 new rules came in regarding financial services. Companies now have Cross-border business, branching and passporting arrangements to deal with. That requires higher costs and a different level of regulation. It also means opting into MiFID regulation and that sky rockets the costs. So, the vast majority of UK IFAs no longer deal with ex pats. A number of providers have withdrawn as well on direct business to ex pats for the same reason. Although they will accept it via IFAs.

There are some exceptions which make the whole thing daft. If you come back to the UK and sign the forms in the UK, even if living abroad as you are, then there is no problem at all and you can deal with any IFA in the country. You cannot post them though. You can get them prepared in advance, everything agreed and then making a flying visit or do it on your next time over.

Your address isnt a problem and having it paid to a UK bank account isnt a problem. Passport and birth certificate will sort that.

NU if you take benefits with them, will pay the commission to the servicing adviser. Regardless of MiFID rules. At the moment that is the adviser that set up the pension in the first place assuming you havent changed servicing rights at any point. That servicing adviser can be changed to any IFA you want as the policy is in force already. You could get the policy assigned to an IFA, get them to check the open market options based on your details (all of which can be done via email and post) and if NU can be beaten, you can sort it on a trip over. If it cannot be beaten you can get the NU pension commenced through the post via the adviser without the need for a visit over and know it was the best option and NU will pay that adviser without any breach of rules having taken place.

There is no problem with the annuity and you bring abroad. Its just another rule to work to.

seven-day-weekend

Informative post dunstonh

EdInvestor

I see the IFA search site will now sort for IFAs opted into Mifid who will act for expats.

http://www.unbiased.co.uk/find-an-ifa/default.asp

Alexander Forbes (formerly the Annuity Bureau) is one that came up as a possibility.