Prudential will use its multi-tie operation to launch back into the personal pension market after a two-year absence.
The firm is launching a stakeholder-friendly basic personal pension in the first half of 2005 and a stakeholder price-buster in the second half of the year.
Pru has been focusing on group personal pensions, inc-luding stakeholder, during its absence from the personal pension market but says the economics of a 1.5 per cent price cap are attractive.
Despite the appeal of the raised charge cap, the stakeholder-friendly pension will only be sold through Pru's multi-tie partners.
Pru has multi-tied to Millfield and Sesame and its expectation that it will get 25 per cent of their business provides the scale needed to make stakeholder profitable. The firm is also in discussions about multi-tying with several other networks and nationals and banks.
The price-buster, which will be offered through both IFAs and multi-ties, will offer add-ons such as a wider third-party fund range but details of both plans are still being finalised.
Both offerings will be based on the Scottish Amicable pension contract previously sold through advisers.
Pru distribution director Andy Briggs says: “We are expanding our product range and relaunching into personal pensions as part of our multi-tie strategy.”
Origen pension specialist Mark Stopard says: “The issue is not so much how committed they are to personal pensions but how committed they are to selling them through the IFA distribution channel.”