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James Hay claims attrition is damaging Sipp business

James Hay has reported a small drop in Sipps under administration as attrition levels continue to cancel out new business.

Last week, the Sipp and Ssas provider’s parent company, IFG Group, revealed the total number of Sipps under administration at James Hay fell from 38,289 at the end of December to 37,956 at the end of April.

James Hay sold 756 new Sipps in the first four months of the year. The firm says it does not have a comparative figure for 2011 but sales in the first six months of last year hit 1,254.

James Hay’s existing book has a relatively old client profile and expects to lose about 10 per cent of existing Sipp customers per year as a result, with some buying an annuity and others dying.

IFG’s interim management statement says: “Through new business and attrition levels, the total number of Sipps under administration was 37,956 at the end of April, just marginally lower than the 38,289 at the end of December 2011.
“Given the planned attrition levels, this is a positive development and augurs well for the crossover point when new business exceeds attrition.”

Syndaxi Chartered Financial Planner managing director Robert Reid says: “If James Hay has a relatively old client book it will inevitably impact on the number of Sipps it administers.”

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