Enhanced and standard annuity income quotes from payingtoomuch.com

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Consumers can get online quotes for the income their pension will provide for them in retirement, taking into account their health and lifestyle.

The payingtoomuch annuity looks to be a class leading customer journey, geared to delivering great client outcomes

http://www.payingtoomuch.com, have launched a fully online, personalised, consumer annuity quote calculator for annuities, which factors in an individual’s health and lifestyle, taking into consideration over 3100 medical conditions. The service shows individuals approaching retirement the best annuity income they could receive from a panel of different insurance companies which could increase their retirement income by up to 160+ per cent.

payingtoomuch aims to underwrite every individual as experience shows many people believe they are perfectly fit and healthy, but from an underwriting point of view they may qualify for a better quote based on conditions that are well under control such as high blood pressure. Also, the customer’s postcode and marital status can play a part too,     increasing the retirement income for otherwise-healthy people.

To access the annuity quotes, an individual must know the value of their pension (or savings) pot available to purchase an annuity which can be as low as £1,000, their planned retirement date, whether they want a single or joint (with partner*) annuity. They will need to provide details about their medical conditions and answer a couple of basic lifestyle questions. Those with medical conditions or who smoke could receive higher retirement annuities as their life expectancy is lower, so it is important to disclose everything.

Multiple personalised quotes are produced showing the best retirement incomes for a level paying annuity, an annuity linking income payments to the RPI, and an income with a guaranteed payment period after death. These quotes are guaranteed for a limited period of time and once a customer proceeds to the application stage the payingtoomuch team deals with all the paperwork to make the process as simple as possible for them.

payingtoomuch offer a non-advised service and cap their commissions at 2.25% (lower at 1.35% where there are no medical conditions) with an absolute monetary limit of £1,600. This compares to a maximum commission charge of 3.5% charged by some firms.

Ali Richards, payingtoomuch’s Head of Annuities said, “Our experience from travel insurance shows that customers that take (for example) a tablet for high blood pressure don’t think they’re ill. Yet our research shows that for travel insurance there’s about a 30 per cent under-disclosure rate.

“Paying annuities monthly in advance makes them fractionally lower on paper but it means there is no delay in the first payment which is what most people want. By our calculations an individual may need to claim the pension for up to 20 years before they become worse off than taking an annuity payable monthly in arrears which may appear fractionally better but obviously starts a month after the plan is set up.”

For most individuals getting a quote this will be their first port of call, and they may be weeks, if not months, from retirement. Because annuity rates can change in the period from quote stage to a customer’s retirement date, payingtoomuch re-calculates each quote between the initial quote date and the stated retirement date and communicates changes by email which includes charting of the annuity changes over that time. This is done monthly, then weekly then daily in the run-up to retirement and helps the individual manage their way into retirement.

If an individual wishes to proceed, payingtoomuch will allocate a personal representative to handle the administration and to ensure everything runs smoothly. This will include assistance in completing the application paperwork and ensuring the medical disclosures are as accurate and complete as possible.

Ali Richards, continued, “Selecting a retirement income is a very important decision that affects the rest of your life. Once the annuity has started the benefits cannot be changed. Yet surprisingly people are more reluctant to shop around than they are for their insurances.

“Our new calculator makes annuity comparison much simpler as it can all be done online from start to finish without the need to speak to anyone, including consideration of medical conditions. For someone who is fit and healthy, getting the quotes could only take 2 minutes. For someone with medical conditions it could take longer depending on the complexity of the details being disclosed.

“Too many people lose out financially by significant amounts when they retire, simply because they accept the annuity offered by their current insurance company. They don’t bother to check if they can get a better deal elsewhere, which they usually can.

“Our personal representatives can also help guide consumers though the medical question screens if needed, which can potentially increase their annuity rate further. Our staff are trained and experienced in gathering details about the various conditions and medications which the insurers need to know about.”

The average individual pension pot in the UK is £28,000 providing few alternatives to purchasing an annuity.

Additional comments:

John Pollock, CEO for Legal & General’s Protection and Annuities businesses said, "As a leading annuity provider and a very customer focused organisation, we understand just how important it is that people are aware of all the annuity options available to them. I was very impressed with the transparency of payingtoomuch’s user friendly annuity service. Customers are able to easily check the annuity options and income available for their personal circumstances, which is what people need when making this life-time decision."

Philip Brown Head of Retirement Propositions at LV= said, “I see this as a great opportunity to work with Mike Ward who has a proven track record of designing consumer friendly online journeys. This new service coincides with the launch of payingtoomuch.com’s ‘Find an Adviser’ service which enables those customers who do want advice, something that LV= advocates when retirement decisions are being taken, to find a qualified adviser close to their home to assist them.

Paul Yates, Product Development Director, Avelo said “The payingtoomuch annuity looks to be a class leading customer journey, geared to delivering great client outcomes.”

  • ‘partner’ includes married or unmarried including same sex couples, and financially dependent children.

+ a table of medical conditions and possible annuity improvements is attached.
# most providers guarantee their quotes for a minimum of 14 days, but sometimes certain medical conditions require further underwriting. Where this is the case, the payingtoomuch team of Annuity Specialists will liaise with the providers to ensure that the best rates are secured for the customer.

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