Frequently Asked Questions

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You asked: How can I reduce the risk of my pension income fluctuating?

With Profits Pension Annuity customers only

There are two ways you can do this.

1) You can change your Anticipated Bonus Rate (ABR). Doing this will alter the pension income we pay you, as well as the basic pension and guaranteed pension we use to calculate your income in future years.

  • If you reduce your ABR it will make future decreases in your income less likely.
  • If you increase your ABR it will make future decreases more likely.

You can set your ABR between 0% and 4% or 5%, in steps of 0.25% when taking out your annuity, and change it at any time after the first anniversary of taking out your annuity.

2) With Profits Pension Annuities taken out since May 2000 can be converted to a conventional annuity any time after the first anniversary. Doing so means you'll get a guaranteed pension income for the rest of your life, without the investment risk that comes with a With Profits Pension Annuity. Once you have converted to a conventional annuity you cannot change back to a With Profits Pension Annuity.

You can pick either a level annuity (which pays the same amount for the rest of your life) or an escalating annuity (where your pension income will increase by 3% compounding each year). Your guaranteed income amount will be recalculated.

Please note, when converting to a conventional annuity, it is not possible to change your options (such as including a pension for your spouse if you die) even if your circumstances have changed. Visit our retirement page for more information.

We strongly suggest that you take financial advice before making any decisions. If you don't have a financial adviser you can find a financial adviser in your area at unbiased.co.uk. Where advice is provided, there may be an additional cost to you.

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