Worst UK pension providers named
"Britain's worst pension providers have been named for the first time in official tables that reveal how some insurers are paying annuities 30% below the best deals on the market.
Scottish Widows and Clerical Medical, part of the government-backed Lloyds Banking Group, have emerged as the worst providers of retirement incomes for the mainstream market. The insurers pay an annuity (a guaranteed annual income in retirement) of £839 a year on a savings pot of £18,000, compared to £1,099 at the best payer, Reliance Mutual. Major companies exposed as low payers on conventional annuities include the £70bn Phoenix Group, which controls the savings of 6 million people through brands such as Pearl and Royal & Sun Alliance.
The figures were published by the Association of British Insurers amid growing criticism that annuities are failing savers. Many savers in pension schemes are unaware that when they retire, they can shop around with the pot of money they have accumulated. Until now, best buy tables have revealed the top payers, but have not exposed the worst, leaving many savers unaware that if they stay with the pension plan they saved with, they may receive a poor annuity.
More than 400,000 people retire every year with an annuity, but recent research found that just 13% realised that by taking an annuity with their existing pension provider, they risked ending up with a lower income than they could get by shopping around. Less than one in five realised that if they smoked or were overweight, they could also obtain a higher income..."
http://www.theguardian.com/money/2013/aug/21/worst-uk-pension-annuity-named-abi