You are here: Home - Retirement - Retirement planning - News -

Slim pickings of annuity providers as Canada Life buys Retirement Advantage

Written by: Paloma Kubiak
Canada Life Group announced it has acquired Retirement Advantage which means pension savers will have a choice of just six annuity providers in the market.

Canada Life has reached an agreement to buy financial services provider Retirement Advantage, however, the sum involved has not been disclosed.

Retirement Advantage was created in 2015 following a merger between MGM Advantage and Stonehaven, and it has 30,000 pension and equity release customers with £2bn of assets under management.

A statement read: “Although this is a very exciting time for Retirement Advantage, right now, it is very much business as usual. There are no changes to your product terms or conditions, and we will of course continue to provide you with the same level of support.”

However, the deal is subject to regulatory approval, which is expected to take between three and six months.

Number of annuity providers fall

Following the move, retirement savers will be left with just a choice of six annuity providers, according to Hargreaves Lansdown.

Nathan Long, senior pension analyst at Hargreaves Lansdown, said another annuity provider bites the dust, as the impact of the new pension freedoms continues to be felt.

“We have not seen Retirement Advantage offer particularly competitive annuity rates for some time, so while we don’t expect annuity rates to be impacted in the short-term, it is still disappointing that another provider has left the market. Long-term this cannot help competition, something we know the regulator, the Financial Conduct Authority, is currently concerned about.

“Retirement Advantage’s innovative retirement income solutions could get a new lease of life with Canada Life’s backing.”

Long added that shopping around for the best annuity rate remains critical for anyone approaching retirement and said: “Annuities still have a huge part to play in retirement and we continue to believe that most people will benefit from some form of secure income like an annuity or final salary pension in retirement to cover any essential spending.”

The current annuity market players:

  • Aviva (standard and enhanced)
  • Canada Life (standard and enhanced)
  • Hodge Lifetime (standard rates only)
  • Just Retirement (enhanced rates only)
  • Legal & General (standard and enhanced)
  • Scottish Widows (standard rates only)

These are the providers which have pulled out of the open market in recent years:

  • Aegon
  • LV=
  • Partnership (merged with Just Retirement)
  • Prudential
  • Standard Life
  • Friends Life (merged with Aviva)
  • Reliance Mutual
  • B&CE
  • Retirement Advantage

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

  • RT @j_g_henderson: It's been an interesting couple of weeks for stock markets, and on @YourMoneyUK Nick Dixon sets out his six golden rules…
  • RT @j_g_henderson: It's been an interesting couple of weeks for stock markets, and on @YourMoneyUK Nick Dixon sets out his six golden rules…
  • RT @j_g_henderson: It's been an interesting couple of weeks for stock markets, and on @YourMoneyUK Nick Dixon sets out his six golden rules…
Read previous post:
savings couple
Savers back calls for early closure of bank funding scheme

Savings experts have welcomed calls for the Bank of England to close a scheme designed to provide banks with cheap...