Phoenix Group, the UK’s largest specialist consolidator of closed life funds, has today announced that it is running a scheme to allow a group of Phoenix Life customers with small annuities in payment the ability to exchange the regular income they receive for a one-off taxable lump sum.

This announcement follows a successful exercise carried out by Phoenix in 2013. Phoenix is making this offer under existing ‘Small Pot’ legislation. It is available to a group of Phoenix Life customers aged between 55 and 85 with an annuity in payment not exceeding £300 a year, provided that the calculated value does not exceed £2,000 and which commenced before the freedoms were introduced in April 2015.

Danny Dowd, Head of Retirement Propositions for Phoenix said: “We recognise that many of our customers have annuities which provide very small regular income payments. This scheme offers them a choice which they will unlikely have had before – to take a one-off lump sum now or continue to receive their annuity payments.”

Phoenix will start to offer this option to a group of eligible customers from November 2017. The amount Phoenix is offering will reflect all the potential future benefits that might be expected under the policy. Customers will be able to opt for this via one straightforward claim form (including an online option from January 2018), and they will have six weeks to consider whether to take up the offer.

Customers who want to continue with their annuity do not need to do anything and there will be no changes made to their policy.

Each customer will receive a clear personal outline of the amount they could receive and the tax implications of acceptance. Phoenix is also recommending policyholders speak to TPAS, who are available to speak to customers and provide independent guidance, if they are unsure of what to do next, or to seek independent financial advice.

Danny Dowd, Head of Retirement Propositions for Phoenix Life continues: “Offering customers the option of taking a one-off lump sum is a win-win situation. It offers customers a greater degree of control, but also enables us to free up resources that go into administrating small annuities.”

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 Enquiries

Shellie Wells
Head of Corporate Communications
Phoenix Group
020 3735 0922 / 07872 414 137
shellie.wells@thephoenixgroup.com

Louise Hetherington
Lansons
020 7294 3678
louiseh@lansons.com

Notes to editors

The expected amount is calculated by working out the amount and timing of each pension payment allowing for any annual increases and the likelihood of it being paid. Where the policy also pays a pension to a surviving spouse or dependant after the death of the policyholder we also take these payments into account. We then reduce the value of future payments to allow for interest we could have earned. The net payment is the expected amount after taking off tax due to HM Revenue & Customs (HMRC).

The Phoenix Group is the UK’s largest specialist consolidator of closed life and pension funds with over 6.1 million policyholders and £75 billion of assets held by the Group’s life companies, including the acquired AXA Wealth, SunLife and Abbey Life businesses.