Gilt yield reductions caused by Brexit may deter savers from buying an annuity and see their pension choice limited to drawdown, Aegon's head of pensions has said.
This comes after a surprising buoyant annuities market in 2015. The Association of British Insurers reported that £990m was invested in annuities in second-quarter last year with £1.3bn taken as cash lump sums. By the fourth quarter, annuity sales had risen to £1.1bn, while £660m was taken as lump sums. This uptick followed a stretch following pension freedom in which annuities were out of favour because they were considered less flexible than drawdown pension products. However, annuities are set to face another change of fortune according to Aegon's head of pensions Kate Smith. She a...
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