Payouts for savers caught in annuity mis-selling scandal

The Financial Conduct Authority (FCA) led an investigation into annuity mis-selling which uncovered ‘poor behaviour’, and as a result, around 90,000 savers could finally get thousands of pounds in compensation.

Prudential and Standard Life were caught mis-selling annuities to ill people, as uncovered by the FCA last year. The investigation did not name pension providers, but Prudential and Standard Life are working with the FCA to calculate sufficient redress.

Around 90,000 pensioners could be given thousands of pounds in compensation after pension providers failed to pay-out full amounts of cash. The FCA found that on average, each lost an annual amount of £120-£240 in pension savings, as reported by This is Money. 

A spokeswoman for Standard Life Aberdeen told This is Money: ‘We continue to work with the Financial Conduct Authority to ensure the annuity review is conducted in a way that means customers get the right outcome.

‘This on-going dialogue includes our approach to reviewing customer records and the calculation of any redress due as a result of this review.

‘We expect the annuity review to be fully operational during 2018 and will start writing to affected customers at that time.’

A Prudential spokesperson said: ‘Conversations are continuing with the regulator who is preparing the redress calculation that we will use to help customers, and we are waiting to be notified of this.

‘We will then contact our customers who are affected directly – they do not need to do anything.’

What’s an Annuity?

An annuity is another word for a regular annual income derived from your pension pot. You purchase an annuity from an insurance company or an independent financial advisor (IFA). The annuity provider is then responsible for paying the annual income for the rest of your life.

When purchasing an annuity, you have to consider all possible options as there are many different types of products to choose from. It is important that you buy an annuity which best meets your personal requirements, as well as the needs of your family.

In many instances, customers have been mis-sold unsuitable products which could have a significant impact on your income. Mis-sold annuity claims can be very complex and as such, it is crucial you take specialist advice.

How can we help?

Here at Cooper Stern, we are experts at advising individuals and businesses on mis-sold complex financial products.
If you feel you have been mis-sold, please get in touch by calling 01204 328 287, or use our online enquiry form.