Prudential revamps flexible lifetime annuity product

Prudential has also improved its fund range which now comes with a range of 50 funds, adding 32 new funds to the range.

The launch of the flexible lifetime annuity comes at a time when falling corporate bond rates are putting downward pressure on conventional annuity rates and people in retirement are increasingly looking beyond traditional choices when considering their retirement income options.

According to Vince Smith-Hughes, head of business development for retirement income at Prudential, the increased number of funds will mean a wider investment choice for people who select the flexible lifetime annuity in their retirement.

It will include funds from Artemis, Axa, BlackRock, Gartmore, and JP Morgan among others, while retaining the current range which includes funds from Invesco, M&G, Newton and Prudential.

With the flexible lifetime annuity customers can choose from one of four investment strategies - cautious, standard, adventurous and the self-managed investment strategy - which reflect the level of risk for each strategy, rather than the funds within the portfolio.

Mr Smith-Hughes said: "We are seeing a shift in the options that people are prepared to consider when selecting an annuity.

"Greater choice, flexibility and investment diversity are becoming increasingly important to our customer base as it becomes more sophisticated.

"A new lower minimum investment amount and a revamped fund range has increased the choice available to customers and is part of our strategy to offer the widest range of annuities in the UK."