British Insurers Advocate Comparison Shopping for Annuities

The Association of British Insurers announced that the organization will adopt a new code of conduct that could have a meaningful impact on annuity sales.

The decision is in response to criticisms of annuity industry sales processes.  Critics have argued that current industry practices are inconsistent and opaque, and that this confusing annuity shopping environment ends-up costing financial services consumers real money. 

A recent report published by a British pension group suggests that current sales processes cost half a million retirees as much as $1.57 billion in future pension income.

A core feature of the code of conduct is the need for British insurers to provide clear and simple information on how to comparison shop for annuities.

The code also encourages insurers to provide clear information on alternative products, sources of advice and how their products fit within the broader annuity landscape.

The association said its members will adopt the new code of conduct by March of 2013.

Source: BBC

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