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The results of the FSA's thematic work on open market options is a step in the right direction, according to Jason Walker, senior manager for AWD Chase de Vere, but he believes the message must be far stronger if consumers are to benefit from the highest possible level of retirement in the open market.

Mr Walker said: "Literature from life companies is not clear enough regarding the open market options. Consumers should be in no doubt that they have a choice of annuity providers and by how much it could increase their retirement income. At the very least the open market option should be up-front and in bold - frankly, some documentation is so unclear, I doubt whether it would be regarded as meeting the FSA's treating customers fairly initiative.

"Annuities are complex and consumers need to take advice if they are to receive the best deal. Factors such as health or even where the client lives must be considered as impaired life or postcode annuities can significantly increase income. Other things to consider such as death guarantees, inflation increases and widows' pensions will all affect the level of income paid.”

Martin Bamford, joint managing director of Surrey-based IFA Informed Choice, said: "The figures speak for themselves - the take up of the open market option is low, which means there are barriers somewhere. The best result for the consumer would be clarity from life companies, combined with independent financial advice, to ensure they get the best rate and can consider all retirement options holistically.”