Sales of variable annuities slumped 42% in the third quarter of 2009, research suggests.
UK Q3 variable annuity sales fell to £143.1m compared to the second quarter total of £343.7m, according to figures by Watson Wyatt.
Andy Sanders, senior consultant at Watson Wyatt, says: "These figures are indicative of challenging economic times for businesses and individuals and also reflect Hartford's withdrawal from the marketplace."
Despite the drop, Wyatt says 'third way' products remain an appropriate option for a large number of consumers both approaching and at retirement.
Due to the anticipated growth in the 'at-retirement' market there is still a considerable commercial opportunity for providers and those looking to enter the market for the long-term, it says.
Sanders adds: "Reinvigoration of this market may be needed to remind consumers and advisers of the virtues of 'third way' propositions like variable annuities as alternatives to conventional annuities and income drawdown."
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