According to the Financial Conduct Authority (FCA) some pension firms are failing elderly clients with many missing out on better policies available. The result has led to the FCA encouraging clients to look around before deciding a pension provider.
The report found that the vast majority of customers were not informed of better offers around their pension and were missing out from their annuity- an income for life- as they did not look around for other offers. The FCA have recommended legislative reform that would make it obligatory to inform the customer of other quotes available to them.
The report found that those who had purchased annuities had not been informed of the best option for them, with companies failing to suggest other plans or other providers that may be more adequate for them.
Despite the mis-selling of some annuities, the FCA believes that for some, buying an annuity is still the best option.
Christopher Woolard, the director of policy, risk and research at the FCA praised the suggested changes saying: “We want the industry to play its part; we want to clean up how people are presented with their options.”
Despite the pension reforms that are coming into effect in England and Wales in the near future, the FCA found that there was no mis-selling of annuities, however have encouraged customers to shop around before they settle for a pension scheme.
The FCA also encouraged customers to plan their pension to ensure they had a proper pension structure in place.
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