Norwich Union, a leading provider of annuities in the UK market, and the UK arm of global insurer, Aviva, has sent executives to the US to talk about variable annuities. They are in talks with their American counterpart over the possibility of launching a variable annuity product into the UK market.
Richard Catchpole, of Norwich Union, has said that a very senior level team of executives had been to the US in the last two months to have high level conversations about how the third way market was shaping up.
Their UK annuities team are waiting for feedback from these meetings in order to see what the strategic direction would be, but said variable annuities were ‘the future’.
This news comes two years after Aviva acquired the US insurer AmerUs for approximately £1.6 billion, which offered a product similar to variable annuities. This product is known in the US as a fixed indexed annuity (FIA). Before being acquired, AmerUs introduced special lifetime income benefits on its FIA product making it even more similar to the variable annuity products we have over here.
A big name like Norwich Union entering the variable annuity market will give the UK market a lift, and more retirees will look at this as an alternative to a pension annuity.
