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24 May 2010

Annuity Direct targets the big firm retirement scheme arena as Pensions Regulator becomes more vocal about open market option. Increased interest from Trustees seeking the highest annuity rate for members More and more blue chip firms turning to specialist brokers Annuity Direct invests in systems to reassure Trustees that their duties to members will be properly discharged As a Chartered firm of Financial Planners, Trustees are assured of the highest professional standards SPECIALIST retirement adviser Annuity Direct has committed to a ‘substantial’ investment in its information technology capability in order to help facilitate securing major blue chip pensions’ business. In the wake of recent major contract wins with a number of top consultancies Annuity Direct’s Bob Bullivant said opportunities for specialist advisers are now increasingly arising as a result of Trustees becoming progressively more aware of their obligations. However, he warned that Data Protection legislation and the requirement to prove best rate means that advisory firms need to be at the top of their game in terms of expertise and their system support. “Just as consumers are frequently being told how they must exercise their open market option when it comes to taking out an annuity, the Pensions’ Regulator has become very vocal on the need for major employers to secure the best deal for their workers’ pension options,” said Bullivant. “Pensions trustees have a duty of common law to their members – and a key element of that duty is for the Trustee to ensure that member data is adequately protected. “Significant investment in our Trustee Broking business has been required in order to maintain our competitive position - our IT systems are not only robust but, more importantly, secure to the highest possible standards.“ Another major factor in securing pensions’ trustee business is a competitive fee structure. “Fees are important – just because a company is very large it doesn’t mean it does not want value for money, and we can significantly undercut the market by offering a bespoke fee structure – be it on a bundled or unbundled basis,” he added. The advantages of going to a specialist broker are manifold, but Bullivant said a key area too often overlooked in company plans is medical history. “The first question to ask is, are company schemes including medical forms as a standard procedure?” he said. “There are eight enhanced product providers and medical questionnaires should be seen by them all – it is not possible to second guess an underwriter. “Generally, far better deals are available on impaired annuities, and too often we find company schemes do not exploit this growing area to their fullest advantage. There are also new and innovative products such as short term annuities that have come to the market and once again our duty is to ensure that these are properly considered.”

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