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Widows raises the cash stakes

Scottish Widows is raising stakeholder commission levels for IFAs, bucking the trend in an effort to increase its market share.

Rivals Standard Life and Norwich Union both recently slashed commission rates as a result of the squeeze on margins.

Widows is offering 60 per cent of Lautro rates, up from 45 per cent, plus 1 per cent level commission on regular-premium business until the end of June.

This puts Widows significantly above its rivals, which offer around 40-45 per cent of Lautro rates.

Widows is also offering 6 per cent initial commission on single premiums until the end of June compared with a market norm of 4 per cent.

IFAs see the move as an attempt to buy business in the market, which has been disillusioned by recent poor performance from the life office.

Roberts Clark director Ashley Clark says: “This may be a very calculated move but is it sensible? Who knows what will come out of CP121. Perhaps this is Widows giving good commission terms now while it can. They are taking on loss-leading business to attract business.”

Widows marketing manager (IFA pensions) Ann Flynn says: “We are going against the trend. We are offering IFAs better terms as a thank-you for their support and it shows the strength of being owned by Lloyds TSB. It is part of our long-term strategy to develop in the IFA sector.”


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