View more on these topics

Annuity sales up 11% despite falling rates

Annuity rates at lowest level for at least two years.

Advised sales of annuities were up 11.3 per cent in the first three months of the year compared to the last quarter of 2014, despite annuity rates falling to their lowest level in two years.

Iress analysis of over 150,000 advised annuity sales found the average single life annuity rate was 4.86 per cent in the first quarer of the year, down from 4.89 per cent in the previous quarter – the lowest level since June 2013 when the report was first compiled.

In addition, there was a 75 basis point spread between the best and worst annuity rates available in March. The average best rate was 5.2 per cent and the worst was 4.45 per cent.

Iress says for the average advised pot size – £64,036 – this means a difference of £12,500 over 25 years.

In March, the average annuity purchased was £3,112, down from £3,369 in February.

The report also shows a rise in the proportion of enhanced annuities sold. In the three months to April, 35 per cent of all annuities sold were enhanced, compared to 30 per cent in the previous quarter.

Iress commericial executive general manager Dave Miller says: “Annuity rates are heading in the wrong direction to stimulate a sustained revival in demand, as retirees face almost unprecedented options in retirement.

”Providers have been cautious in the run up to the new freedoms taking hold, waiting to see how consumers are reacting, and while we have seen some innovation, the real flurry of flexible products has yet to materialise. This competition, in concert with rising gilt yields, should place upwards pressure on rates as the year progresses.”


Think-tank handed £50m by Resolution founder Clive Cowdery

The founder of insurance and investment firm Resolution Clive Cowdery has given £50m to the Resolution Trust, a think-tank that aims to improve the lives of people on low and middle incomes. To coincide with the new funding, Resolution Foundation chief executive Gavin Kelly will become chief executive of the Resolution Trust and retiring MP […]

Labour won’t pursue heavy-handed regulation

A Labour government would avoid heavy-handed regulation, according to shadow chancellor Ed Balls, despite plans for a bank bonus tax and to raise the top rate of income tax. Speaking to the Financial Times, Balls said that Labour would seek to institute a 50p income tax rate throughout the next parliament, but would also seek […]

HMRC takes bank bonus appeal to Supreme Court

The UK’s highest court is to hear an appeal by HMRC over two offshore schemes used by banks to shield staff payments from tax. The tax office will attempt to convince the Supreme Court that UBS and Deutsche Bank used the schemes to avoid tax in 2003 and 2004, the FT reports. Employees received shares […]

Leading Edge June – Investment panel debate

RLAM’s asset class specialists discuss some of the findings from the panel session at our recent Investment Conference. By Rob Williams, Head of Distribution Welcome to the latest edition of Leading Edge. It has been an eventful six months since the last e-zine. The European Central Bank announced ongoing stimulus measures, while the immigration crisis in Europe threw the […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm