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Old Mutual Wealth comment on secondary annuity market


The Government has announced plans for a secondary annuity market, allowing more than five million people to exchange their regular retirement income for a lump sum:

News story: Millions given freedom over their pension as government outlines new secondary annuity market

Below is a comment from Adrian Walker, retirement planning manager at Old Mutual Wealth:

Development of the market

"The secondary annuity market is likely to be relatively limited and attractive to those currently in receipt of a small regular payment. For those people a lump sum may be viewed as more valuable.

"A survey we undertook with YouGov suggested that less than 20% of people ‎would consider selling their annuity, with the major factor for this reluctance being a concern they would not receive value for money.

"In any event, the safeguards that are put in place to protect anyone hoping to sell their annuity will be vitally important.‎ This market will be one where the potential buyers will be much better informed than the sellers. For the market to operate properly there will need to be effective competition and I will be interested to see where this competition comes from."


Advice requirement

“An annuity acts the same as a final-salary pension in that it provides a guaranteed income for life, often with built in guarantees such as a commitment to match inflation. Individuals with a final-salary pension and those in defined contribution schemes with safeguarded benefits are required to take professional financial advice before sacrificing pensions worth more than £30,000. It is logical that a second-hand annuity market should operate the same way, with people compelled to seek an expert opinion before swapping in a valuable annuity for a lump sum or an alternative pension income product. 

“The option to sell your annuity is not a bad one in principle. Some people will welcome the freedom and flexibility to trade in secure income for pot of money they can take flexibly in their retirement.

“However, before rushing into a decision, it is important that people remember that the market for second hand annuities is likely to be one in which buyers hold all the information and sellers are in a relatively weak position. Nonetheless, a good deal is in the eye of the beholder. For someone with debts or personal circumstances which mean an annuity no longer meets their needs,  taking cash could be an attractive option.”

For more information contact

Tim Skelton-SmithOld Mutual Wealth02380 916 99807824 145

Notes to editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £118.1 billion in customer investments (as at 30 September 2018).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions and discretionary fund management.

The business is comprised of two segments: Wealth Platforms and Advice and Wealth Management.

Wealth Platforms includes the Old Mutual Wealth UK Platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

Advice and Wealth Management encompasses the financial planning network, Intrinsic; Quilter Private Client Advisers; discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

The Quilter plc businesses are being re-branded to Quilter over a period of approximately two years:

• The Multi-asset business is now Quilter Investors

• Intrinsic to Quilter Financial Planning

• The private client advisers business is now Quilter Private Client Advisers

• The UK Platform to Quilter Wealth Solutions

• The International business to Quilter International

• The Heritage life assurance business to Quilter Life Assurance

• Quilter Cheviot will retain its name

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.