Fewer consumers shopping around for annuities

Commenting on ABI business data, Craig Fazzini-Jones, Director and Head of MGM Advantage Designs for Retirement said: "It's a real shame that the number of people using the open market option and getting the best possible income for their retirement has dropped in the last year.

"The credit crunch, the massive fall in interest on savings and the effects of inflation are all hitting pensioners harder than any other group and the extra annual income they could have gained by shopping around has never been more important. This was also during a year when annuity rates were at their highest for six years.

"As an industry, the ABI figures should act as a wake up call and it's time we pulled together to put people facing retirement at the top of our agenda. The open market option should be the default choice for pension customers so they are forced to stop and think about their options before making an irreversible decision.

"Let's explain annuities to consumers in a way they can understand and cut out the jargon and small print that puts people off. And, if we could make doing annuity business simpler and more profitable for IFAs, they'd be more likely to take on smaller pension pot business and find the right annuity for the lower net worth consumers who are the real victims in the latest OMO figures."