The conduct of pension providers' annuity sales teams will form a large part of the Financial Conduct Authority's (FCA's) continuing investigation into the retirement income market.
The regulator's thematic review, released today, found 80% of consumers who stick with their original pension provider for a standard annuity miss out on about £1,500.
The amount was significantly higher for people who qualify for an enhanced annuity.
The regulator will now conduct a study to assess competition in the market and gain an understanding of why consumers do not shop around.
It will also undertake further supervisory work focusing on how pension provider sales teams "conduct themselves when selling annuities to existing customers". This will include retention teams who's aim is to keep existing customers.
The FCA said it had three operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system and to promote effective competition in the interests of consumers.
It has not proposed the creation of new rules at this state, however, it said it continued assessment of the retirement market meant it will consider "very carefully whether changes to its investment rule book are needed to create a market that treats its customers better".
The interim findings of the study - covering both competition and sales culture work - will be published in the summer, the FCA said.
Within 12 months the FCA said it will publish the final competition market study report, outlining proposed remedies.
Depending on the findings of the competition market study, the remedies could include rule changes designed to stimulate competition in the market or to constrain the behaviour of certain firms.
The FCA said it "wants to ensure that retirement income market can evolve to meet the changing demands of consumers".
Lowest level since 2016
Subset of fintech
Just one-fifth not in favour
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