Critics call for annuity sales to fall under the RDR, while others say advice is prohibitively expensive.
Response to recommendations by the Financial Services Consumer
Panel to increase transparency of non-advised annuity sales and to
include an option for advice have ranged from critics saying they are
too onerous to those saying they are not extensive enough.
Yesterday, the FSCP reported findings which showed non-advised annuity sales are often marketed as ‘free’
but in fact pay 5 to 6 per cent commission, well above the 1.5 to 3 per
cent average. The report also criticised a lack of any requirement to
consider the ‘whole of market’.
The panel recommended the
FCA undertake a complete overhaul of non-advised sales and introduce a
code of conduct that would demand, among other things, that annuity
providers be forced to offer an advised service as well as their
traditional non-advised route.
Andrew Tully, pensions technical director, MGM Advantage said there is
still a significant lack of awareness of the potential benefits of
shopping around among savers approaching retirement, and that the
annuity market as a whole needs a thorough overhaul.
To read the full article, please click here.
Source: FT Adviser
No comments:
Post a Comment