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Work Pensions – More Information
Individuals save into their work pensions during their working life and so build up a pension pot.
At some point during the first years of retirement, they will usually use the money that they have saved to buy an annuity from an insurance company. An annuity is an annual retirement income that is paid to them for the rest of their life. It is a series of equal payments at regular intervals.
First, there are standard annuities – available to all. Then there are enhanced annuities that can be bought by people with a lower life expectancy, generally smokers or those with a medical condition.Enhanced Annuities are more generous because the insurance company is betting that they will not have to make the annual payment for very long.Longevity is an important factor. As people live longer, insurance companies expect to pay out more, in effect lowering the returns that pensioners can get.
You could have been sold the wrong Annuity rate if proper investigations were not carried out by the annuity provider or Independent Financial Advisor. This may result in a standard annuity rate being applied rather than an enhanced annuity rate.
You could have been incorrectly assessed and not been given an enhanced rate if you had a serious health issue when you took out the annuity. These issues include heart disease, cancer, high blood pressure, Parkinson’s, Neurological disorders, diabetes, MS etc. Was your GP was aware of any unhealthy lifestyle habits when you took out the annuity such as smoking, drinking alcohol or obesity? If so then you should also have been put onto an enhanced rate.
Has your spouse died and their annuity has not passed over to you? If that is the case then it could be that the annuity has been miss-sold. There should have been provision for a surviving partner made in your work pension scheme.
Was it made clear to you that you had could shop around for the best annuity rate?. Were you told to take the route of an Open Market Option? If not, you could have been badly advised and may be eligible to compensation.
A useful analysis of the Annuity scandal that faces hundreds of thousands of pensioners can be viewed by following these links;
Telegraph Online : 11th Dec 2014
Channel 4 Online : 18th Nov 2013
Misadvised to transfer out of your work pension?
This has been blamed on a change in the law by the government in the 80′s who stopped employers making their Occupational Pension plans compulsory for all employees. This opened the way for the newly introduced personal pensions.
Helped by carefully orchestrated sale drives, personal pensions sold well and the financial services industry enjoyed a huge boom. Some described this as a feeding frenzy.
It gradually became clear that people who had changed from their occupational pensions into personal pensions were much worse off. They lost out on employers’ contributions. Some of the personal pensions were bad buys due to high charges and lack of flexibility.
If you feel you may have been mis sold your pension, the company which sold it to you must give you an information pack on the scandal. If you feel you may have been a victim of mis-selling contact us for a free review of your pension.
For a free review of your pension to advise you if you are entitled to compensation please contact us on: 0800 988 7997 or complete the quick enquiry form.