Annuity consulting services. Assisting the annuity purchase process with expertise

Transcription

1 Annuity consulting services Assisting the annuity purchase process with expertise

2 Capita annuity desk Your member s retirement is our priority too. The retirement process from DC pension schemes should be the successful culmination of years of careful provision by members and employers in the build up to retirement. Converting a retirement fund into pension income can be a difficult time for members and without careful management it can be a long process with many associated risks. It can be difficult for members to understand this process. All too often they are not made aware of the range of options available to them at retirement and the lifetime benefits of making the correct choice. With this in mind, our annuity team is designed to meet the evolving needs and obligations of clients to their members by providing a full Open Market Option (OMO) annuity broking service. We are committed to being at the cutting edge of industry practise utilising all the resources that are available to help the annuity purchase process. Our Annuity Desk team facilitates the purchase of annuities and other income options on behalf of Trustees, incorporating the OMO arrangements and including industry-wide provider research. We provide annuity broking services to a wide range of pension schemes and industry professionals. The sole function of our annuity team is to obtain the best possible income for pension scheme members. We use a range of research tools to obtain the best possible rates, whether this is for standard or enhanced annuity rates. We appreciate that the retirement process can be difficult; the range of information and forms to be completed can be overwhelming. For this reason, we actively encourage members to contact us to discuss any aspect of the annuity purchase process and help them through the paperwork. Our friendly, no-nonsense approach means that with our assistance, a significant number of our members achieve improved annuity rates. 2

3 Webline A key feature of our service is the Webline quotation portal, developed by Capita Financial Software, bringing clients the benefits of automated online realtime annuity quotations. This internet based system underpins our member-facing annuity quotation facility as part of our web facilities. Online quotations are immediately available for normal or impaired lives and those with negative lifestyles. This enables us to respond to time sensitive issues and help manage member expectations. with major providers, enabling us to place even the smallest of funds. We are also able to negotiate with annuity providers on a case-by-case basis in situations where an individual member s circumstances may warrant special treatment, such as health or time sensitive issues. You can be sure that we will work to achieve the best possible annuity rate for every member of your scheme. Using the Capita research software, we are able to source the best available rates, based on an individual member s circumstances. And while the majority of annuity providers can be accessed via the Webline portal, we still revert to wider searches of providers that do not participate or where we feel that better rates might be obtained for specific cases. The buying power of Capita means we have been able to negotiate preferential terms 3

4 Our annuity purchase process The annuity purchase process is at one level a rate driven exercise. Our presence in the market means that we are able to achieve the best possible rates for our clients. However, we do not simply focus on the rates offered by providers; we also consider the provider s financial strength and their capability to operate annuity set-up and payments efficiently and reliably. Our processes offer individual members the opportunity to shape their own annuity benefit at no extra cost to them. Unlike many other brokers we do not normally charge extra for some of the more specialised purchases such as Impaired Life annuities. This is because we do not want to create artificial barriers to members getting the best possible income in retirement. Members are able to discuss their situation with our experienced staff, including FSA regulated individuals, to ensure they are fully informed of the options and are confident that the outcome is the best they can achieve. We also offer immediate vesting pensions to enable AVC members to release tax free cash or to combine multiple pension funds into a single annuity. Our ability to speedily research all annuity options together with our attention to service levels means that Trustees can be confident of meeting their regulatory obligations in respect of providing choices to members within the prescribed timescales. 4

5 Our service Our services include: Administration interface liaison between Pension Administration (in-house or external) and the annuity provider. Friendly communication with members. Access to FSA registered advisers. Documentation and policy set-up. Money movements. Clear and easy information that members understand. Complete market research every time. Intelligent, proactive advice to the Trustee from an established corporate pension provider. Our clients can also choose to benefit from some of our additional services such as management reporting or stewardship reports. Scheme de-risking through purchasing individual at-retirement annuities for defined benefit arrangements. 5

6 Enhanced annuities The significance of encouraging members to explore enhanced annuities cannot be overstated as even a modest enhancement can amount to a significant sum over the lifetime of the annuity. Also, even the smallest of funds (e.g. 500) can potentially qualify for enhanced terms. Case studies Illustration 1 shows how income is increased (enhanced) for relatively common-place conditions: 3,828 3,892 3,973 4,240 3, % % % % Standard Rate Smoker Rate Non smoker with high Smoker with HBP, blood pressure (HBP), a high body mass raised cholesterol & angina & diabetes Smoker with HBP, diabetes, angina, TIA (minor) stroke As at 25th Nov 2011 Enhanced rate income comparison Figures shown illustrate potential increase in retirement income based on a purchase sum of 50,000 for a single life male aged 65, no annual increases, no guarantee, paid monthly in arrears. 6

7 Illustration 2 shows the difference in the achieved for a male aged 70, who suffers from Parkinsons disease. The annuity was arranged to provide a 50% pension for his wife, who is aged 60, with a 5 year guarantee. The pension fund included a post 1988 GMP element and the total fund available for annuity purchase was 88,600. Extra 23% 679pa Annual income 2,952 2,952 As at 25th Nov 2011 Standard Terms Enhanced Terms As can be seen from the illustration, extra income of 679 per annum was achieved which, over 10 years, equates to an extra 6,790. 7

8 To find out more, please contact your Capita consultant or visit facebook.com/capitaemployeebenefits Employee benefits 487/1 Capita Employee Benefits is a trading name of Capita Employee Benefits Limited and Capita Employee Benefits (Consulting) Limited. Part of Capita plc. Capita Employee Benefits Limited and Capita Employee Benefits (Consulting) Limited are registered in England & Wales No: and respectively. Registered Office: 17 Rochester Row, Westminster, London, SW1P 1QT. Separately authorised and regulated by the Financial Services Authority.