Is Webb's cashing-in annuities plan a blessing or curse for savers?

Pensions minister Steve Webb recently called for retirees to be able to cash in or swap annuity providers in much the same way homeowners can currently switch their mortgage rate.

This is a natural extension to the freedoms afforded to pensions from April this year when the requirement to annuitise will be eliminated.

The proposal to allow the cashing-in of annuities seeks to address the concerns of the 5m individuals who have already used their retirement pot to buy an annuity, prior to Osborne’s Budget announcement.

It also would help tackle the perennial problem of individuals who failed to shop around when purchasing an annuity and subsequently found themselves locked into a poor-value product.

But what would a secondary market for annuities look like for the individual? Would flexibility provide a better deal? And how would it be regulated? 

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