Men urged to purchase pension annuity before EU rule change

MEN planning to buy an annuity over the coming months have been urged to act quickly as the clock ticks down to new rules that will accelerate the decline in annuity rates.

The City watchdog this week published consumer information on the implications of a ban on the use of gender in setting prices for insurance products.

The ban, which comes into force on 21 December and is the result of a European Court of Justice directive, affects the pricing of annuities, used by most retirees to convert their pension fund into an income.

The annuity rates for male pension savers could fall by up to 13 per cent, while women face increases in life and motor insurance. But with annuity contracts sometimes taking several weeks to process, Tom McPhail, head of pensions research at Hargreaves Lansdown, said men planning to buy an annuity should act sooner rather than later.