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Slump in stakeholder sales prompts plea for a review

The ABI has called for a rethink on stakeholder pensions after disappointing sales in the second quarter of the years despite the raising of the charge cap to 1.5 per cent.

The product attracted sales of just 92m on an APE basis, leading the ABI to call for a simplification of the basic advice regime to help with stakeholder sales.

Overall, new life and pension business was up by 7.3 per cent to 2.98bn in the second quarter after stripping out a single bulk annuity deal.

There was little move on the first quarter, with IFAs taking a 63.1 per cent share of the total regular-prem- ium market compared with 31.8 per cent for single ties and 5.1 per cent for disin- termediated.

But IFAs saw almost a 10 per cent fall in their share of single-premium business, down from 69.1 to 59.9 per cent but single ties only took an extra 0.1 per cent, up to 23.4 per cent.

ABI life and pensions director Chris Kenny says: “The stakeholder range of savings products has so far failed to make any appreciable imp- act and there is still much to be done to make the stakeholder concept work.”

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