L&G confirms 'renewed commitment' to annuities

L&G says it plans to announce product enhancements to its annuities proposition later in the year and will host a series of briefing sessions for advisers to demonstrate the importance of annuities in retirement planning.

Its research found that retirees continue to see a guaranteed source of retirement income as vital, however maintaining a source of income was a repeated concern, as was the impact of possible health care costs later in retirement.

The research also found that women were often much less confident about making financial decisions to support their retirement, with respondents stating that they didn’t have enough knowledge about pensions and knew very little about annuities.

In 2017, Legal & General experienced a 93% increase in individual annuity premiums. This upward trend is also borne out by statistics from the ABI, which predicts there will be a steady increase in annual annuity sales into the 2020s.

But L&G says more needs to be done to educate people about the different types of annuities available and to highlight the importance of advice from independent financial advisers.

Emma Byron, managing director of retail retirement income at Legal & General, said: “We know customers need and want choice and security in retirement. We believe, for people who are risk averse or have a limited capacity for loss, annuities are an attractive proposition.

"Retirement planning needs to reflect the changing nature of life in our later years, and people’s changing needs: gone are the days when we retired at sixty-five and made one choice for retirement income. People are living longer and fuller lives, and they need to revisit their retirement planning regularly. We need to provide products to support them in this.”