It is, in fact, hugely competitive among companies that want to take on annuity business and there are around 768 options on the type of annuity you want.So even before you think about moving to another provider, figuring out what you need to buy can be difficult enough. At the bottom end of the market, there is little help on offer. Financial advisers are usually reluctant to help anyone with less than around £30,000 to spend. The commission they can earn is usually between 1 and 1.4 per cent, meaning it is not worth the adviser's time for the amount of work involved.For many people, annuities do provide them the income security they want. Where life insurance comes to your family's rescue if you die too soon (sounds awful, but that's how actuaries view these things), annuities act as an insurance policy against living too long. They give you a guaranteed income for life, no matter how long you live.As improvements to our health mean we are all set to live much longer, it would be nice to be able to have enough money to enjoy it.Much of the heckling on annuities tends to come from wealthier retirees, who balk at being told what to do with their money and hate insurance companies keeping all their money when they die.But generally speaking, the better-off don't do badly out of the annuity pool.

It is the less well-off who tend to die earlier, and the wealthy, enjoying better health from their more comfortable lifestyle, live to a riper old age on the funds supplied by those who die first.The Government is reviewing how to make the annuity market more flexible. It is certainly in its interest to make it work as efficiently as possible, but it seems very unlikely compulsory purchase at age 75 will change.The Government's biggest fear is that, given the chance, pensioners will be reckless with the funds they have saved, and squander them on cruises and bingo tickets, and will end up in queues at the post office waiting for handouts from the state.The open-market option does not only apply to annuities. Insurance companies will also have to make sure holders of endowment policies who ask for information on surrender values are made aware of the other options available. This includes the possibility that they may be able to sell their policy on the traded market as an alternative to surrendering it. This will be worth remembering when the next round of red letters come piling through your door.r.stevenson independent.co.uk. As of next week, pension companies will have to be more up front with customers about their right to find a better annuity deal elsewhere. When you retire, the pension fund you have been saving in through your working life is used to buy an annuity from a pension company This provides income for the rest of your life.

Moneynetpensionssearch As of next week, pension companies will have to be more up front with customers about their right to find a better annuity deal elsewhere. This provides income for the rest of your life. Pension companies write to customers before they retire, informing them of their annuity options, which includes the ability to take out one with a different pension company, known as the open-market option.Two out of three people accept the choice offered to them by their existing pension provider, not realising they could shop around. Guidelines from the Financial Services Authority coming in to effect next week should make the open-market option and the ability to find a better rate elsewhere easier for customers. The difference between the best and the worst rates can make a sizeable difference to your income.For a woman aged 60 with a £50,000 pension pot, buying a level annuity that has a guarantee of five years, the best rate on the market is 6.45 per cent, or £3,225 a year The worst is 5.84 per cent, or £2,920 a year. That's a difference to your income of 10.4 per cent.For a joint-life annuity that covers you and your spouse if you are both 65, with £100,000 to spend, the best rate for a five-year guaranteed annuity that grows in line with inflation is 4.43 per cent, or £4,430 a year The worst rate is 3.94 per cent, or an income of £3,940. That is a difference 12.4 per cent.Dr Stephen Cretney, 66, had to find out the hard way the benefits of shopping around.