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Axa links commission to GPP profitability

Axa is to tie the level of commission it will pay on group pension schemes to their profitability and persistency.

The insurer’s current standard commission rates will be used as a benchmark with advisers receiving commensurately less commission on less profitable schemes. This means IFA remuneration on every Axa group scheme will be dealt with on a case by case basis and follows similar moves by other product providers.

The key determinant for the firm will be persistency. Axa is aiming for schemes with between 250 and 5,000 members and says commission for schemes of this size with good persistency rates will typically see commission unchanged.

The company will turn away unprofitable business and pay zero commission on any minimally profitable schemes it takes on.

Axa spokesman Steve Muir says the group is keen to build on its success in the group pensions market and will adopt a more”scientific” approach to its commission strategy.

He says: “We do not want to cloud our book with expensive to run, unprofitable business. It is not a question of cutting costs but of enhancing profitability. Good terms will be available to those IFAs who bring us quality business.”

Hargreaves Lansdown head of pension research Tom McPhail says: “All the pressure on commission appears downwards and many companies are moving to payment by a case-by-case basis.”


Double-fund loophole is shut

The Inland Revenue has closed a loophole that would have allowed investors to double-fund their pension ahead of A-day. Investors could have transferred assets in an occupational scheme into a personal pension and then switched this into a section 590 scheme, which would enable investors to build pots bigger than the lifetime limit as retained […]

Pru principles

So the Pru are to return to the protection market after a gap of 18 months following its decision to increase CI premiums for cases still in underwriting? Bully for them.

Reports of death of deferral exaggerated

The Government announced on February 10 that “a number of avoidance schemes have been disclosed to the Inland Revenue which aim to generate capital losses using corporate capital redemption bonds. From today, where one of these bonds is disposed of by a company, no capital loss can arise.”

Suffolk Life appoints new sales manager

Suffolk Life has announced the appointment of John Nielsen as sales manager, reporting to John Moret, director of sales and marketing. Nielsens main responsibility at Suffolk Life will be building new relationships with IFAs and investment managers.

Industry under fire over pension freedoms

By Jamie Clark, Business Development Manager, Royal London Recent articles in the media have raised concerns about the new pension freedoms. One perceived problem is that across the industry, trustees and providers are not necessarily allowing people to take full advantage of the pension freedoms in situ. This is backed up by a recent survey by […]


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