The use of postcodes in calculating annuities has always been controversial. Helen Morrissey finds out the pros and cons of using this approach
Postcodes have been used for years in the pricing of many insurance products. However, when Legal & General recently announced a pilot project where postcodes would be used in pricing annuities many providers and IFAs denounced the approach as "crude" and a "blunt object". However, it's worth bearing in mind that the use of postcodes in this way is nothing new. Insurance company MGM used postcodes when pricing annuities while Norwich Union has also looked into their use in the past. So what benefits can this approach have and why are Legal & General looking at it now? "We've been looking ...
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