Client News
· Best Male single life level annuity rates slumps again: In a mixed month for single life male annuities, table topper Aviva cut its rate by a further £130 to £5,590 p.a., while 2nd place L&G jumped from 5th spot in November by increasing its rate by £64 a year to £5,420. Hodge Life was unchanged in 3rd place on £5,390 – but Canada Life fell from 2nd place in November to 4th in December with a significant cut of £312 p.a., to £5,135 p.a. (All figures based on male, aged 60, level, £100,000 purchase).
· Some relief for Inflation-linked annuities: Aviva, which had cut its male RPI rate by £50 in November, held top slot with an annual inflation linked annuity rate of £3,150. Meanwhile Standard Life remained in 2nd place with its rate unchanged at £3,118 p.a. and L&G climbed to 3rd place in the table by increasing its rate by £210 p.a. to £3,040. (All figures based on male, aged 60, RPI, £100,000 purchase).
· Smokers rates slide: Having benefited from largely stable rates in recent months, smokers rates also began to slip in December. Reliance Mutual grabbed top slot from LV=, simply by leaving its rate unchanged at £6,721. Aviva reduced its rates by £60 p.a. to £5910, but climbed to 4th place. (All figures based on male, smoker, aged 60, level, £100,000 purchase).
Gemma Goodman, Head of Alexander Forbes Annuity Bureau, comments:
“There’s been a mixed bag of rate changes in December, some providers have cut rates quite sharply, but we have also seen others offer increases as well, so shopping around for the best rate remains essential. At least part of the price moves will be for purely commercial reasons, with providers either trying to increase their annuity books or reduce demand. They will also have been looking carefully at the ongoing crisis the Eurozone and its impact on UK gilt rates, which can have a significant impact on underlying annuity rates. I suspect that we will continue to see volatility in annuity rates as we enter 2012 – but overall I expect the long term trend to remain downwards.”