Pru eyes sell-off of £45bn annuity book


Prudential is reviewing its £45bn annuities business in a move that could lead to a break-up of the company into separate international divisions.

According to the Times, the review is being led by former Aegon chief financial officer Clare Bousfield who joined Pru last month as insurance chief executive. Bousfield worked on the sale of Aegon’s annuity business to Legal & General and Rothesay Life in the spring.

Commentators are questioning whether the review will lead to a restructure of the entire Prudential company into separate UK, US and Asian operations.

Suggested buyers for the Pru annuity book include Rothesay, Pension Insurance Corporation, Swiss Re’s Admin Re or private equity firms.

Pru withdrew from offering annuities on the open market in June.

The insurer did not comment.



How dangerous is the decline of annuity competition?

The stockmarket took just under an hour to decide former chancellor George Osborne’s pension freedoms spelled doom for traditional annuities. The share prices of Just Retirement and Partnership – which, as enhanced annuity specialists, were severely exposed – plummeted in the wake of the announcement. Traditional insurers were also hit, although these more diversified businesses […]


Are providers facing the slow death of the annuity market?

Providers are continuing to back annuities despite a mass exodus from the market amid predictions that a “perfect storm” could lead to the sector becoming unviable. LV= is the latest provider to rethink its enhanced annuity offering, having entered discussions with staff about plans to quit the market last week. This Wednesday, it decided on leaving. […]


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There are 5 comments at the moment, we would love to hear your opinion too.

  1. Being a huge fan of the annuity (rightly or wrongly) I do find it a real shame annuities, are now treated a bit like the runt of the litter.

    I don’t think this is to do with pension freedoms (as such) or that rates are low, but I believe its more to do with providers having to abide by unreasonable process, compliance and cost, I mean…… how can it be, that a provider cant promote its own product (in reality) and direct the consumer to its many competitors ? they are shackled to a process; meaning, that should they stray the full weight of the FCA will bare down on them, a gross restriction of trade and micro management to the extreme, do you not think ?

    Its little wonder providers are eager to palm off this business to any fool who would have it !

  2. Over the years I have had to deal with distraught widows who found out their recently departed spouse’s annuity went with him. The only firm that ever rewrote the annuity was NPI, no other life office was interested in the plight of the surviving spouse. A money making racket?

  3. Are you saying they had taken a single life annuity.

    Surely if they had a spouse, they would be advised to take joint life.

    Given that women live longer, and are often younger than their husband, surely this is a no brainer.

  4. Not sure if that’s a serious comment Evan? Do you ever go into a bookmakers after your horse has lost and ask if you can transfer the bet to another runner?

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