25 January 2010
Annuity rates are recovering from last year's record lows,
prompting advisers to suggest that people nearing retirement should
take some pension income now.
Several leading providers started this year by raising rates on
their standard and enhanced annuities - putting hundreds more into
the pockets of those buying a pension income now, compared with
what was offered in the last quarter of 2009.
Aviva, the country's largest life insurer, has increased its
standard annuity rates by between 0.25 per cent and 1.9 per cent
and improved its escalating annuities.
Canada Life has increased its joint life annuity rates by 2.5
per cent and made a "small" adjustment to its enhanced rates for
those in poorer health.
Legal & General's rates went up by 1 per cent on 1
January.
Pension advisers say this trend is good news for those nearing
retirement. Last year, annuity rates crashed by about 10 per cent
to 15-year lows on the back of unprecedented volatility in the gilt
market.
