While focus is increasingly turning to transparency around annuity pricing and encouraging shopping around, a straw poll conducted by Unbiased suggests there is a far more fundamental knowledge gap to address as two thirds of people do not even know what an annuity is.
Based on a survey of 172 Unbiased.co.uk users, the website found that 37 per cent of respondents admitted they did not understand what an annuity was.
The straw poll comes a fortnight after the Association of British Insurers released its Annuity Window tool, revealing annuity rates for many products across the market and demonstrating the importance of shopping around before buying.
Karen Barrett, chief executive of Unbiased, said: “There is no doubt that shopping around for the best annuity deal is one of the most important financial decisions someone will make in their lifetime.
“But as our research shows, if almost two in five customers don’t know what an annuity is, how can we expect them to be able to confidently make the best choice on the different options available?
“We believe that tools help people engage with the annuity process and offer guidance on what to expect but do not replace the value a financial adviser can add.”