Steady growth in pensions new business

Steady growth in life and pensions new business sales is continuing, according to the latest figures from the ABI (Association of British Insurers).

Overall APE new business in the third quarter of 2006 was £3.813 billion, an increase of 30.2% on the same quarter in 2005. In particular, sales of individual pensions rose substantially, from £810 million APE in Q3 2005 to £1.269 billion APE in Q3 2006. Group Personal Pensions performed particularly well, with new sales of £356m APE in Q3 2006, up 32.3% from £269m in Q3 2005.

Chris Kenny, the ABI’s Director of Life and Pensions, said: “These figures show the life and pensions industry in healthy shape. In particular, Group Personal Pensions have increased year-on-year. Employers play an important role in pension provision, so this is a positive sign of continued employer engagement with pensions. We're delighted by John Hutton's comments at the ABI Saver Summit this week that Personal Accounts will be designed to extend, not replace, this provision.

”There is some transferred business within these figures. We're working to improve our data to capture this better. But we shouldn't forget that such market movements are often a sign of consumers seeking the best returns and service. It's important that the FSA's distribution review addresses concerns about business models, but without reducing this healthy competition.”