View more on these topics

Annuities slump yet to translate into drawdown boom

Money-Cash-Coins-GBP-Pounds-UK-700x450.jpg

Falling annuities sales have not translated into a drawdown boom, the latest Association of British Insurers’ figures show.

Despite the number of new annuity policies written falling 38 per cent from 28,700  to 20,600 over the first three months of the year, drawdown sales were flat.

The number of drawdown contracts sold was roughly unchanged in the run-up to the pensions freedoms compared to the end of 2014.

Around 11,500 contracts were entered into in the first quarter of 2015, only slightly more than in the final three months of last year.

However, year-on-year sales are up 64 per cent, from 6,700 in the same period of 2014.

But more drawdown customers are buying off their existing provider, with 42 per cent of sales being internal in Q1, compared to 40 per cent in Q4 2014.

Annuities sales are down 72 per cent, from 74,100 in the first quarter of 2014.

ABI retirement policy manager Rob Yuille says: “These figures show the impact that pension flexibility had even before the full reforms came into force in April.

“The product choices being made on the eve of the changes reflect a changing market but also a diverse set of needs and preferences. This is a good reminder that people need guidance or advice to help them find the right retirement product for their circumstances.”

Recommended

George-Osborne-extends-arm-with-Budget-box-700.jpg
1

What does the Budget have in store for pensions?

Chancellor George Osborne is capable of throwing the element of surprise into his Budget announcements. With this in mind, what lies in store for pensions in the emergency Budget on 8 July – the first fully Conservative Budget since 1996 – may not be easy to predict. “Trying to second-guess the Chancellor is difficult but […]

FCA logo new 620x430.jpg
9

Advisers slam ‘ineffective’ FCA over 10% fee hike

Advisers have criticised the “ineffective” FCA after the regulator defended a 10 per cent increase in advisers’ fees. This week the FCA confirmed that firms in the A13 block will pay £74.9m in regulatory fees in 2015/16, up from £68m in 2014/15. The A13 fee block relates to advisers who do not hold client money. […]

Business-Corporate-Commuters-People-700x450.jpg

Sesame to close Cheltenham office

Sesame is closing its Cheltenham office and consulting with staff as it prepares to shut its network for investment advisers. Sesame will keep open its remaining offices in Altrincham, Birmingham and Huddersfield. The business says that 30 staff are based in Cheltenham and are currently in consultation. Sesame announced in March plans to close its […]

Bamford-Martin-2013-700x450.jpg
9

Martin Bamford: Advisers must face up to the Paul Lewis challenge

It is easy in this profession to get upset by the little things. Sometimes it feels like every public comment made is a personal attack on our character, behaviour and professional judgement. For example, when we read the latest Money Marketing columns by Paul Lewis and Nic Cicutti, it is only natural to take offence […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There is one comment at the moment, we would love to hear your opinion too.

  1. Not difficult to work pout. The clever money has taken the PCLS and is hanging onto the funds within the tax protected wrapper until annuity rates look better. This could come about with ageing, poor health or (let us hope) with a decent rise in interest rates.

Leave a comment