The director and former chief executive of Isle of Wight-based Annuity Direct said pensions providers chased too much profit and ruined good products.
He said: “If you go back over the years, without doubt [life offices] have always ruined the market through greed.
“They had a really good thing going with low-cost endowment mortgages and they had a really good thing with with profits. Good sense went out the window in their greed for new business.”
Mr Bullivant said the problem was a change from a conservative culture to a sales-focused culture. Along with it came a decline in the culture of deference to the customer.
He said: “There was a sense that you treat customers properly in those days. It was much more ‘my word is my bond’.”
One target of his ire is the treatment of endowment mortgages, which were popular in the 1980s but ran into trouble when it became clear returns would not repay the mortgage.
“The early policies did repay the mortgage, but more and more companies jumped on the bandwagon and wanted lower and lower premiums, which meant less going in to fund the mortgage,” he added.
Mr Bullivant started work in the late 1960s at the Guardian Royal Exchange as a trainee. Among his later roles were corporate development director at Britannic Retirement Solutions, and chief executive of Annuity Direct, where he helped oversee its sale to Fidelity last year.
ABI response
Otto Thoresen, director general of the Association of British Insurers, said: “What the industry is doing is to help everyone realise they have a choice at retirement and enable them to exercise that choice in a way that is right for them. The industry will do all it can to meet challenges created by radical reforms in the recent Budget.”
