The annuity market is one of the few which is still growing, and is set to reach £20billion by 2012, according to Just Retirement.
Independent financial advisors (IFAs) need to up their game and move into the annuities
market more fervently if they are to survive the credit crunch, as other traditional sources of income falter, such as mortgages, Just Retirement has found.
IFAs are therefore looking for other ways of generating revenue, but more should be looking at pension annuities
as it is one of the few sectors still growing, according to the retirement services provider.
A survey of IFAs conducted for Just Retirement found that the majority need to double their annuity business in order to generate a "credible" stream of income and make it through the recession; but the research also revealed that one in three IFAs has written fewer than 10 annuity cases in the last 12 months.
For those approaching retirement in the current economic climate, while incomes are being squeezed due to falling returns on savings and investments, getting the right annuity advice
through the Open Market Option
has become "ever more crucial", Just Retirement said.
"Our research highlights the need to raise awareness of annuities amongst IFAs as well as a potential review of the whole process itself," comments Nigel Barlow, head of retirement solutions at Just Retirement. £With a staggering 1 million people set to retire every year, the annuity market is predicted to be worth £20 billion by 2012.
"An increase in annuity knowledge and a simpler process would lead to more IFAs becoming engaged with the market," Mr Barlow believes.
"Interestingly, almost half of the IFAs surveyed (49%) said they have seen no change in the demand for annuities in the current climate, stating that business in this area is being sustained, which confirms the real value and security annuities can offer in uncertain times," Mr Barlow continued. "Therefore an increased awareness of annuities could only help facilitate the process of encouraging people to shop around and make use of the open market option."
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