Annuity reform may spark product innovation

Although some believe the end of compulsory annuitisation will put pay to this form of retirement income, it might take pressure off annuities and result in innovation and new product development

The Department for Work and Pensions issued a consultation document called Modernising Annuities in February 2002. Soon after, work commenced on the pensions simplification project it was announced that the results of the consultation would be confirmed as part of the new pension regime. So what did it say? First, a lifetime annuity must meet the following conditions: l it is payable by an insurance company; l the member has an opportunity to select the insurance company; l the annuity is payable until the member's death or until the later of either the member's death or the end of a gu...