IFAs are reaping the benefit of the collapse in direct salesforces and now account for nearly 60 per cent of the growing individual life and pension market, according to the latest ABI figures.
IFAs took 59.4 per cent or £1.3bn of all new individual life and pension business on an equivalent premium income basis in the first quarter of this year, up from 50.7 per cent or £1.1bn over the same quarter last year. Direct salesforce business fell to 29.7 per cent or £0.7bn from 37 per cent or £0.8bn. Tied agent sales also fell to 4.1 per cent from 4.7 per cent.
Individual pension sales were up to £716m EPI from £555m EPI over the same period last year, with IFAs securing 80.6 per cent of the market from 63.4 per cent last year. Direct salesforce market share fell to 16.1 per cent from 32.1 per cent over the same period as tied agent sales halved to 1.1 per cent from 2.2 per cent.
IFA sales of annuities and drawdown plans leapt to 75 per cent of EPI from 63.5 per cent last year while direct sales fell to 19.3 per cent from 29.5 per cent. Total sales of life and pension business were up to £2.61bn EPI from £2.42bn EPI. The ABI says increased awareness of pensions through the introduction of stakeholder accounts for the increase.
Syndaxi Financial Planning principal Robert Reid says: “The number of salesforces has gone down and new methods of distribution have not caught up. Other forms of distribution will come through. IFAs should not be complacent.”