Legal & General has reported a 53 per cent slump in individual annuity sales for the first nine months of 2014 as a result of Chancellor George Osborne’s retirement overhaul.
The insurer’s third quarter interim management statement, published this morning, reveals individual annuity sales fell from just over £1bn in the year to September 2013 to £508m during the same period this year.
Individual annuity sales in Q3 were down 61 per cent year-on-year, from £323m last year to £125m in 2014.
The impact of the reforms has been cushioned, however, by a rapid rise in bulk annuity business during the year. Bulk annuity sales for the nine months to September this year were £3.37bn, up 29 per cent compared to the £2.6bn of new business secured during the same period in 2013.
UK protection sales grew 10 per cent in the year to September, from £162m in 2013 to £178m this year. Year-on-year protection sales for Q3 were down slightly, from £57m to £55m.
L&G group chief executive Nigel Wilson says: “We remain confident in our ability to deliver economically and socially useful products for our customers and strong and sustainable growth for our shareholders. Recent market volatility is a reminder of the on-going market uncertainty that still exists and whilst no model can be completely immunised, we believe our strategy creates a high degree of resilience.”