The Kent-based IFA said the new service, dubbed the Open Market Option Bureau, was a “unique not-for-profit service” which would focus on local, impartial advice for annuity purchasers, and would help advisers promote themselves to consumers within a 25 mile radius of their businesses.
He said: “The open market option annuity market is already huge and will only grow as the regulators seek to optimise uptake of the open market option. The retirement planning potential for new business is enormous.
“The benefits for advisers and consumers are clear – our research shows that 40 per cent of those buying annuities are not aware of their options and less than 30 per cent take up the open market option. However 80 per cent of those who seek advice take up the open market option.”
Mr Down added that the fee-based tool aimed to target 25,000 new business leads a year, with revenue generated used to buy online, print, radio and TV advertising to raise awareness of the need for impartial advice when buying an annuity.
Costing £25 a month, he said the subscription meant advisers could compete with execution-only and comparison sites, with a further cost of £40 for every lead the Open Market Option Bureau forwarded to advisers.
The Bureau was launched as the FSA investigates the £11bn a year market and the Association of British Insurers launched its own code of conduct ensuring people buying annuities are made aware of the open market option, by implementing comparison tables.
National Association of Pension Funds research estimates around £1bn a year is lost by consumers accepting the annuity offered by their pension provider and not using their open market option.
The service has been endorsed by leading providers including LV=, Partnership, Just Retirement and MGM Advantage.
