Helen Morrissey talks to MetLife's Peter Carter about how the business is developing
How are things going at MetLife right now?
We are very pleased with how well things went for us in 2009. Last year was a difficult one for many life offices but we managed to double our business during the course of 2009. We have been aiming to ensure we can offer guarantees across all of the wrappers we offer; whether it is a capital guarantee, income for life or deferred. We felt that offering consistency across our products was good for IFAs whether they are looking to use an offshore bond, onshore bond, SSAS or SIPP.
It was recently announced that MetLife is to acquire Alico – what does this mean for MetLife?
The purchase of Alico will extend our international reach and we feel the business is complementary. The deal will close in November and it is very much business as usual as we continue to focus on meeting our targets for the year. So far it is all going very well.
What are your key areas of focus right now?
We have done and are continuing to do a number of different things. We have completed a number of white papers which we see as forming a key element in the acceptance of the products we offer in the marketplace. We need to be totally transparent with advisers about what we offer and so we have been running a number of masterclasses going into detail about how we manage risk so they know more about how we work. We are also launching a guide to unit linked guarantees which will go into more detail about what is available and how MetLife manages risk. We are aiming to give advisers the information they need so that they feel comfortable and can offer our products with confidence. We expect more players to enter this market over the coming 12 months and I feel they will be able to benefit a lot of people.
Variable annuities have been available for some time now. Is it time we started seeing some second generation products emerge?
We feel we are already offering second generation products. We revisited and completely re-launched our product set in 2008. We looked closely at our products and the key things we n these things across our product range. It’s all working very well so far.
In terms of IFAs we are getting deeper penetration into the market and this is helpful. However, I do feel that were it comes to unit linked guarantees there is also a lot of consumer, as well as IFA demand. People want guarantees, they want inflation beating returns but they are concerned about downside risk. This has been particularly the case since the credit crunch.
You recently extended your range of guarantees into the SIPP and SSAS arena – why did you decide to do this?
This idea followed on from our original product range. We had a trustee investment plan in 2007 which was moderately successful but we didn’t feel it was all it could be. We had had success with our personal pension products as well as the offshore and onshore bonds. We decided to revisit the SIPP/SSAS area but look at how we could use the product differently. People want flexibility and we find the new product which we called the Trustee Retirement Portfolio has gone down quite well. We want investors to know they can have guarantees whatever the tax wrapper they choose. The new products have been available since March and we’ve seen a really favourable response.
So what’s next?
We developed a lot of new products during the course of 2009 and we are looking to take advantage of what we have. Going forward we will be communicating the message of what we are doing to advisers and further increase our penetration into the marketplace. This is a low risk product that is increasingly coming into its own as people see how they can benefit. We want to ensure advisers feel comfortable in recommending these products and we are also looking forward to seeing more competitors enter the market. Demographic change means that the retirement market is going to change and we will see further product innovation. I think it’s an area where advisers can really build a strong business.
Peter Carter is MetLife UK's head of product marketing
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