‘Flurry’ of drawdown crystallisation if unisex Gad comes in

A ‘flurry’ of drawdown customers crystallising their funds could be seen if the Government Actuary’s Department (Gad) introduces unisex rates, one Sipp provider has said.

Chris Jones, marketing director at Suffolk Life, said the delayed impact of the gender directive is yet to be seen in drawdown.

“While rates have improved for women, because the men’s Gad tables are now used for everyone, men’s rates are currently unchanged,” he said.

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“However, if Gad introduces unisex tables, rates will fall for both men and women. We’d expect to get advance notice of the introduction of unisex tables, so there may be a flurry of both men and women crystallising in advance of that date in order to get the benefit of the existing men’s rates.”

The government’s initial solution to the gender directive for income drawdown was to set all drawdown rates at the male rate, providing a better deal for female clients. Some suggested that this might mean a heightened interest from women, however several participants in the latest income drawdown survey noted that most Sipp and drawdown customers are male.

Sipp provider Rowanmoor predicted a change to unisex rates could result in incomes dropping by up to 5 per cent.