Annuities are not popular among clients despite their current higher rates but they have a place in people's retirement portfolios, experts say.
A panel of retirement advisers and providers at today's FTAdviser Financial Advice Forum agreed annuities had a part to play in many retirement portfolios as rates have gone up, and they could even help to make portfolios more flexible.
But they are not always a client's first choice, which is where retirement advisers come in.
Billy Burrows, financial adviser at Eadon & Co, said it was good news that rates had recovered but warned delegates not to "underestimate the behavioural side to this, no matter how high annuity rates are".
He said: "There's a lot of advisers and clients who instinctively would prefer to be in drawdown, you know, because of the death benefits."
But he added pensions should be regarded in terms of income, and annuities were "hard to beat".
"Annuities are still the best way of providing the highest level of retirement income," he said.
Mark Ormston, director of propositions and corporate partnerships at Retirement Line, agreed and said guaranteeing parts of the money while rates were high was a popular option. "We're seeing an awful lot of people using [annuities] to cover their essentials."
But Fiona Tait, technical director at Intelligent Pensions, said it was important to ensure a decision to buy an annuity wasn't just driven by rates, "it's still to be driven by what actually is happening with the client".
If the client's circumstances are right, now is a good time to buy an annuity however, she said.
"We didn't write any annuity business last year, not a single one. This year it's gotten significantly higher.
"And the reasons are that we've got a lot of clients who are getting a little bit older. They've been through two years of economic uncertainty, the funds have been going up and down, so there've been reasons to consider annuitising anyway.
"And then with the rates, that just makes it a better recommendation to go forward."
Verona Kenny, managing director of intermediary at 7IM, said annuities could help to keep the retirement plan flexible.
7IM has built a modular retirement approach, which uses drawdown and annuities alongside lifetime mortgages to allow advisers to pick and choose as they see fit.
"What we've been working with is some new innovative kind of products that are very similar to annuities and act and feel like annuities, but they give flexibility," she said.
"And I think that is what we're hearing more and more is that people want flexibility."
7IM has teamed up with Just on a secure lifetime income product which it is offering on its platform. It's a guaranteed income that gets paid every month, but it's up to the client whether that forms part of drawdown or gets reinvested.
