Royal London has reported an 18 per cent increase in new business during the first quarter of 2014, from £839m in Q1 2013 to £989m this year, as chief executive Phil Loney urges the FCA to review its retirement advice rules.
The mutual insurer, which recently launched a direct-to-consumer marketing campaign, saw year-on-year group pensions sales surge 65 per cent, from £268m in the first three months of 2013 to £443m this year.
Drawdown sales increased by almost a third during the period, from £113m to £146m, while individual pension sales rose marginally to £282m.
However, protection new business dropped 39 per cent, from £131m to £80m. Ascentric, Royal London’s wrap platform, experienced a 6 per cent drop in net inflows during the period, from £561m to £530m.
Loney says drawdown sales have risen 22 per cent since the Budget but warns the Government’s at-retirement “guidance guarantee” pledge does not go far enough.
He says: “The Government’s guarantee of “guidance” for people approaching retirement is welcome. But it does not go far enough.
“There is a pressing need for more tailored advice for many people. We urge the FCA to look at its rules around the advice process. The regulator needs to play advisers into the market by developing a new regime for “at retirement” customers that can be delivered in a straightforward and cost-effective way.
“Advisers should be recommending retirement income products from across the market, or if the advice is restricted, it should encompass a range of the best providers. We must not see a repeat of the mistakes made in the annuity market where too many customers were unable to access the best deals in the market.”