A delay in the EU’s Solvency II rules could offer some would-be retirees a little relief from constantly falling Annuity rates.
Falling Annuity rates
Any pension calculator will show that falling gilt yields have pushed Annuity rates to all time lows, with the EU gender directive, to be implemented later this year, likely to push rates even lower.
Falling Annuity rates have caused financial hardship to many retirees and it was feared that Solvency II would further reduce Annuity rates and compound the issues of low gilt yields and the gender directive.
However, it now seems as that there may be a delay in implementing Solvency II, with the Association of British Insurers (ABI) reporting that an agreement has not been reached on the final rules.
Reacting to the news, Hugh Savill of the ABI, said: “We are disappointed that, despite best efforts from all involved, there was no agreement in the Solvency II trialogue.”
He continued: “This delay was not caused or asked for by industry who are keen to see the outstanding issues on Solvency II resolved. This result raises questions about the timetable for Solvency II and will leave insurers in limbo until an agreement is reached.”
Whether the delay in implementing the new rules will help Annuity rates is open to some debate with many retirement experts predicting that Solvency II will come into effect as planned and that the current difficulties will be worked out.
If you are thinking about buying an Annuity, are worried about the effects of falling Annuity or would like advice on your options call one of our IFAs today on 0115 933 8433, alternatively enquire online or email firstname.lastname@example.org