View more on these topics

Variable annuity business doubles in a year to £1bn

Sales of variable annuities have doubled in the past year to over £1bn, according to research from Watson Wyatt.

Variable annuity premiums grew from £539m in 2007 to £1.15bn last year while the number of policies sold rose by more than 80 per cent from 7,775 to 14,128.

Watson Wyatt says the rise was a result of financial advisers and consumers becoming more familiar with third-way products, offered in the UK by Aegon Scottish Equitable, The Hartford, Lincoln Financial Group and MetLife.

It also suggests the benefits of underlying investment guarantees became more apparent during recent turbulent market conditions.

Forty per cent of premiums for variable annuities are from people aged under 60 years, which Watson Wyatt says may dispel perceptions that the products are only for those at or in retirement.

Over a third of the total premiums relate to investments of less than £75,000, which the firm says suggests the product may be appealing to a wider cross-section of people than first envisaged.

Senior consultant Andy Sanders says: “What is encouraging for this fledgling market is that variable annuity sales appear to have held up well so far in the early stages of the current financial crisis, with sales during 2008 increasing quarter upon quarter.

“It will be interesting to see how well these products do during 2009 as the economic downturn plays out. It may be that new designs will be required to maintain and develop further interest among UK consumers.”


Twin win

A dual approach to tax-efficient investment and withdrawls can pay off in the search for income

FSA will analyse RDR costs in June

The FSA has confirmed it will include a cost-benefit analysis and an impact analysis in its June RDR consultation paper, easing concerns from advisers it would be delayed further.Sesame executive chairman Ivan Martin says it is critical that the analysis goes into full detail on all the key cost areas, as advisers face higher regulatory […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    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