Poor lump sum terms 'costing retirees billions every year'

Actuaries warn that cash commutation factors have not been revised in line with market conditions, such as rising longevity, low interest rates and low inflation. Buck Consultants senior corporate consulting actuary Colin Richardson said across the board factors are being understated by 20% to 30% and put the loss for members at a “conservative” £2 to 3bn a year. He said: “It is possible that many advisory firms have not stood up and raised this issue because it may raise some inconvenient matters for advisers and clients. This has helped keep the issue away from the spotlight.” In...