View more on these topics

NU set to cut pension charges as sales slide

Norwich Union has seen individual pension sales slump following a repricing last year and admits it may have to cut its charges if it wants to maintain market share.

Parent group Aviva’s int-erim results show that worldwide sales rose by 25 per cent to £19.2bn in the first six months of 2007 compared with £15.6bn in the same per-iod last year although profits fell by 8 per cent to £1.5bn from £1.6bn due to a flood claims bill of £400m.

UK sales of individual pensions plummeted by 17 per cent to £1.8bn from £2.1bn on a present value of new business premiums’ basis although margins did improve.

NU chief executive Mark Hodges says the firm last year increased charges on its individual pensions from 1 per cent to 1.5 per cent but several rivals have been slower to follow suit than anticipated.

Hodges says: “We can afford to write less pension business and make less money if it is higher-margin business because we want to attract sustainable and profitable business. The question we have to ask is do we persist with the 1.5 per cent product or do we move back to the 1 per cent product?”

NU repriced its stakeholder range two years ago after a charge rise led to sales dropping by more than 10 per cent.

Life operating profit increased by 24 per cent from to £1.2bn from £1bn on a European embedded value basis while UK sales overall rose by 7 per cent to £7.4bn.

Aviva says it will bring all its investment arms under the Aviva Global Investors brand after recruiting new Morley chief Alain Dromer to head the operation. Hodges says no decision has been made on the future of the NU and Morley investment brands.

Recommended

Employers concerned at effects of age legislation

Half of employers believe that anti-age discrimination legislation makes employee benefits such as life cover, income protection and private medical insurance less sustainable in the future.Consultancy Watson Wyatt recently surveyed 130 UK companies and found that 50 per cent believe the Employment Equality (Age) Regulations Act 2006 is threatening the future of protection insurance in […]

First-time buyers could pay £1m for starter homes in 2024

First-time buyers could have to pay £1million for a starter home in 17 years time, according to new research from Stroud & Swindon.The lender has found that if house prices continue to follow the current growth trend, FTB’s would find their first home hitting the £1m mark in 2024.This high cost would be most likely […]

Deutsch courage

German chancellor Angela Merkel has put the country back on the road to long-term economic growth

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com