Demand for annuities has rocketed over the past 12 months, with the number of quotes sourced by advising rising by 60 per cent, according to new data.
Financial services technology provider iPipeline has been tracking the number of annuity comparisons produced on its portal since 2013 and says this is the largest annual increase it has seen, and by a significant margin.
In total quotes for annuities were up 60.1 per cent in 2023 when compared to 2022. This surpasses previous periods of high demand, which occurred in 2013 when quotes increased by 20.2 per cent year on year.
iPipeline also reported that Q3 and Q4 2023 saw the highest number of comparisons run on its portal than for any other quarters in the previous decade.
iPipeline’s annuities portal accounts for 25 per cent of all quotes in the retirement market. The company said interest in annuities has been increasingly steadily alongside interest rates. iPipeline product strategy director Paul Yates adds that many are looking to lock into these competitive rates now, with inflation starting to fall, which is expected to lead to interest rate cuts later this year, which could weaken annuity pricing again.
Paul Yates, Product Strategy Director at iPipeline says: “This year could well be one of huge change in the pensions and retirement sector. Reforms could unlock significant capital and providers must be ready for the swell of activity this could generate. We know from experience that the legacy technology in pensions and annuities is a market drag – providers need to get their systems in order as a matter of urgency or risk losing out.”
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