200,000 pension calls from confused retirees

mature businesswoman talking on mobile phone looking concerned

More than 200,000 calls from people looking to make the most of the new pension freedoms were fielded by financial firms during the first week that the rules were launched, the Association of British Insurers (ABI) has reported.

Between Tuesday and Friday last week, the ABI said its members handled a "surge" of 229,932 phone calls from customers interested in finding out more about what choices they have under the reforms.

This was a 214% increase in average call volumes that would be expected during the period and equated to an average of 57,483 calls each day.

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More than 10,000 written and email requests were also received each day by members, which the ABI said was more than double the normal average.

The new rules, which allow people aged 55 and over to take their pension pot how they wish rather than being required to buy an annuity, launched on Bank Holiday Monday last week, with some firms staying open on that day to answer queries and others opening back up for business on the following day.

The changes apply to the 320,000 people who retire every year with a defined contribution (DC) pension. The changes were announced last year, meaning some people had been hanging on to take advantage of the new rules.

Financial services firm Hargreaves Lansdown has previously estimated that up to 400,000 investors have been poised to take money from their pension funds in the weeks and months following the freedoms.

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So far, some pension firms have reported that people have been looking to take chunks of cash for a range of purposes, including new kitchens, holidays and even speedboats.

The Government-backed Pension Wise service offers everyone eligible for the freedoms free guidance to help them to consider their options.

Rob Yuille, ABI manager, retirement policy, said: "Unsurprisingly many customers, recognising the importance of the reforms, are contacting their pension provider to understand how the changes may affect them.

"Insurers have taken steps to meet this demand, and will continue to explain to customers their options, and encourage them to speak to the free, impartial Pension Wise service before taking any action."