On average there were 3.3 quotes per person in January 2024 up from 2.9 in January last year.

That’s indicative of people shopping around for the best deal, Hargreaves said.

Jack Williams, head of pensions and retirement at Hargreaves, said there had been strong interest from people looking to secure a level of guaranteed income in retirement.

He said the relative calm seen as annuity rates have settled in recent months has encouraged people who otherwise may have hesitated “to take the plunge now” for fear of missing out on a better rate later.

He said: “We are also seeing people use more of their pension to convert to income. With inflation on the way down and interest rate cuts potentially feeding through in the coming months, annuities look better value.”

Just Group warned that retirees waiting until later in life to buy annuities were at most risk of missing out on extra lifetime income by failing to shop around for the best deal.

FCA analysis of annuity rates published last year found that the gap between the best and worst deals is much higher at age 75 than at age 70 or 65. The figures showed a healthy 75-year-old can secure about 17% more income from the best annuity provider compared to the worst. The best-worst gap is 14% at age 70 and 11% at age 65.

Stephen Lowe, group communications director at Just Group, said: “Improving returns have pushed up demand for annuities in recent months but buyers must do their homework to avoid the poor value providers and to secure the highest income possible.”

Meanwhile, average annuities bought through Hargreaves climbed 14% in price in January 2024 compared to the same period last year. Nine in 10 applications were on an enhanced basis.



Currently, a 65-year-old with a £100,000 pension can get up to £7,117 per year from an annuity, according to the HL annuity engine.