A widening gap between the best and worst annuity rates available has highlighted the importance of shopping around for the best deal, according to Investment Life & Pensions Moneyfacts.
The difference between the best and worst standard rates on the open market currently ranges between 11% and 17%, depending on age and sex, for a £10K purchase price, while it rises to between 16% and 22% for a £50K purchase.
By opting for an enhanced rate as a result of either health or lifestyle considerations, annuitants could also radically improve the income they receive.
"The variance between the best and worst rates plus the wider introduction of postcoded annuities and the growth in enhanced options has produced a more complex annuity market than we have seen previously," said Suzanne Greener, deputy editor of Investment Life & Pensions Moneyfacts. "As a result, pensioners could lose out significantly if they don't take the time to research the best deal for their individual circumstances or take advantage of an adviser's expertise."
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