Living Time is currently the only provider in this market. Its income plan offers customers a guaranteed income for a minimum of three years and up to age 75 and a guaranteed capital value at maturity, which is determined at outset. The product is written under drawdown rules.
Money Marketing has learnt that LV= plans to launch a similar product. The firm is also believed to be considering a fixed-term annuity that gives customers investment options.
LV= head of annuities Matt Trott says: “We are looking at the space in the market between an annuity and an income drawdown contract. We are fairly progressed at looking at an opportunity in that market.”
Annuity Direct director Stuart Bayliss says: “New companies looking at this marketplace are very welcome.
“One of the major issues that is slowing down the take-up of Living Time’s product is the fact that there is no competition so having more than one company there will encourage many more advisers and clients to look at the temporary annuity option.”
Living Time marketing director Steve Lowe says: “If this is true, we are very pleased that LV= are considering launching a fixed term annuity. We need more providers in the market to supply the increasing demand from advisers and their clients for modern alternatives to traditional lifetime annuities.”