Annuitants reserve the right to play the market in order to secure the highest income for their savings.
Retirees should be better informed about their annuities options, the Association of British Insurers (ABI) indicated today.
The body said that pension plan providers should send out "wake up" packs to customers, reminding them that they retain the right to purchase an annuity with another firm when the time comes to set their retirement incomes. Previous research has indicated that customers who use this "open market option" can derive around 20 per cent more from their savings than they would otherwise.
Maggie Craig, the ABI's director of life and savings, said: "We are determined to improve the experience of customers approaching retirement. This means ensuring they understand their options, including their right to shop around, so they can make an informed decision and letting them know where to go to get help.
"Buying an annuity is a once in a lifetime decision that can't be changed, so it's vital that customers are given appropriate help to make the right choices, and make the most of their retirement income."
According to the ABI, the "next step" of its project to improve annuities in the UK will be aimed at speeding up the time it takes for the payments to be made to policyholders.
Further details of this initiative are expected from the ABI later this summer.
