Not upheld: delays in annuity setup and fund transfer; failure to honour annuity quotation complaint against Aviva Life & Pensions UK Limited

Decision detail

Summary

Mr E complained that Aviva caused delays in setting up an annuity, resulting in a lower annuity rate being offered, and that Aviva delayed transferring his funds to another annuity provider. The initial annuity quotation from May 2025 was guaranteed until 30 June 2025, but funds from Provider 2 were not received until 31 July 2025 due to a name mismatch error on Provider 2's records. A second quotation was requested and guaranteed until 29 July 2025, but again funds from Provider 2 arrived after the deadline. When the deadline was missed, Aviva recalculated the annuity based on current rates, resulting in a lower annual amount. Mr E then took an annuity with another provider, and Aviva transferred the funds within 6 working days. The ombudsman found that Aviva did not cause delays and was entitled to recalculate the annuity when the guaranteed deadline was missed, so the complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Aviva did not cause delays in the annuity setup process. Although Aviva received funds from Provider 1 before the 29 July 2025 deadline, it was not unreasonable for Aviva to wait for all required funds from both providers before proceeding. The delay in receiving funds from Provider 2 was caused by Provider 2's own error in recording Mr E's name, not by Aviva's actions. Aviva was entitled to recalculate the annuity based on current rates when the guaranteed deadline was missed, as this was clearly stated in the quotation terms. The transfer of funds to the new annuity provider within 6 working days was not unreasonable. Mr E was not entitled to interest as Aviva did not cause any delay or treat him unfairly.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website