Just Retirement says the annuity market is showing signs of recovery and believes the higher number of annuity sales it has seen recently is sustainable.
In a business update for the three months to the end of September, the provider says “guaranteed income for life” sales are up 7 per cent year-on-year, from £129.3m to £138.3m.
Annuity sales are up 26 per cent compared with the previous three months. For the financial year to the end of June, Just Retirement saw annuity sales plummet 56 per cent from £1.1bn to £478m.
Just Retirement’s latest results also saw total defined benefit derisking sales of £103.6m, four times the £24.8m in sales seen this time last year.
But capped and flexible drawdown sales are down 82 per cent, from £20.2m to £3.6m.
Overall total new business sales hit £359.9m, an increase of 41 per cent from £255.1m last year.
Just Retirement group chief executive Rodney Cook says: “We have delivered further strong growth in DB derisking, and the guaranteed income for life segment is showing continuing signs of recovery.
“The 7 per cent increase in our guaranteed income for life sales shows the market is returning to this product, which continues to offer value for the majority of middle Britain consumers.”
Cook adds: “Overall, I remain positive about the outlook. In addition to our increased expectations for our DB business, we also believe the improvement in guaranteed income for life sales is sustainable.”
Just Retirement is on track to complete its proposed merger with Partnership, which is expected to generate £40m in cost savings.