The argument against annuity rate tables and rates calculators

You may already have visited other annuity sites and used a rates calculator or consulted a rate table.

• Were you sure that the information contained within the table was not out of date or the results from the calculator were correct?

• Did the table or calculator take into account all of the products on the market or just a selection of them?

• Did you know that independent pension annuity brokers may have access to a wider range of annuity possibilities?

• Was the information just an illustration rather than an individual quote?

• Did the website promote particular providers over others because they're paid higher commissions by them?

• Are annuity providers able to pay to list their products higher up the recommendation tables, or to have their products shown in a different, maybe more prominent way on the site?

• Were you aware that the annuity rates may change before your application goes through? If you received a quote, was it guaranteed by the website?

Updated by humans or machines?

Did those sites use 'screen-scraping' technology that retrieves and transfers information from other programmes?

According to Wikipedia, "Screen scraping is generally considered an ad-hoc, inelegant technique, often used only as a "last resort" when no other mechanism is available. Aside from the higher programming and processing overhead, output displays intended for human consumption often change structure frequently. Humans can cope with this easily, but computer programs will often crash or produce incorrect results."

But is it OK if the website says that it's been recently updated

Even if the rates table or calculator was 100% up-to-date and correct, did you know that the stated annuity rates may have no resemblance to the income that you will actually achieve? This is because your annuity may increase due to your circumstances, i.e. whether you're a smoker or not, your state of health and medication that you may be taking. Some providers even base your income on your previous occupation or where you live.

Let us say you do find a website where everything is up-to-date and works correctly; do you know at this point whether you want a level, fixed rate escalating or rpi-linked escalating annuity? Also, have you considered your partner's or dependent's percentage after you pass on? Additionally, have you considered an unsecured pension? The choices are often confusing.

What does the Financial Services Authority (FSA) say about comparison sites?

The media and the FSA, the UK financial regulator, have criticised comparison sites for their lack of independence and incomplete information. Consumers often do not realise that they are not getting the complete overall picture.

The FSA say, "Some may only include products that the website can make money from in some way, for example if you click through to the provider." They also state that you should never buy a product just on the basis of what you see on their own tables and they recommend getting advice before using their tables.

(Please note that the information on this page does not represent financial advice. You must consult a broker for complete information. "The argument against annuity rate tables and calculators" is an opinion only and you should not rely on this information to make (or refrain from making) any decisions.)

Annuity advice is at hand

A professional adviser will compare annuity rates helping you to ensure that you maximise your pension annuity income. The'll explain what options are available to you, advise on transferring existing pensions and on investing your tax free pension cash.

They'll of course also help with all the form filling which will help to make sure that your paperwork is processed quickly, smoothly and efficiently.

When seeking impartial advice on choosing the right annuity option that suits your risk profile and circumstances, ensure that the advice is not biased. Many providers, including some banks and building societies can not advise on the annuity products of their competitors.

It's a simple process, start now...

Don't worry, there's absolutely no obligation to proceed. Our specialists will provide comparisons FREE OF CHARGE.



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