Should you put your trust in your pension trustee? Trustees are not trying hard enough to secure the best annuity rates. Pamela Atherton investigates

• Published in: Sunday telegraph (London, England)
• Main Author: Atherton, Pamela
• Format: Newspaper Article
• Language: English
• Published: London (UK) Daily Telegraph 14.11.2004
• ISSN: 0307-269X

An annuity is a guaranteed income for life, purchased with the contents of a pension fund. Fewer than 30 per cent of the company schemes in the Aspen survey said they used a specialist annuity adviser when deciding which annuities to offer members on retirement. Members of money purchase schemes, however, are forced to buy annuities with the money in their individual pension pots. Their retirement pensions are dictated by the size of their fund on retirement, plus the prevailing annuity rate. Annuity purchase is handled by the trustees of the scheme. According to Billy Burrows of William Burrows Annuities: "Although many schemes are now improving the way they arrange annuities for members, some trustees leave themselves open to criticism if members subsequently discover they could have secured a higher annuity on the open market." A single person with a life- threatening medical condition who was sold a standard annuity may have grounds to complain to the Pensions Ombudsman or sue the trustees for breach of fiduciary duty.