Prudential seals annuity deal with rival service

Prudential seals annuity deal with rival service

Prudential has partnered with Just Group's Hub Financial Solutions in a bid to expand the range of annuity products available to its customers.

The introducer agreement will give Prudential clients access to Aviva, Canada Life, Hodge Life, Just Group, L&G and Scottish Widows, doubling the providers currently offered on its panel from three to six.

Prudential no longer offers annuities following its decision to pull out of the open market in 2016.

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David Macmillan, Prudential’s managing director of wealth solutions, said: "We are delighted to finalise this annuity referral agreement with Hub Financial Solutions, which is regarded as one of the UK’s leading providers of retirement products.  

"Having run a non-advised service for 12 years, Hub Financial Solutions is well-placed to help our customers find the annuity of their choice."

Mr Macmillan added: "This agreement is an important development for us and highlights our determination to expand and improve the range of products and services we offer customers. It means they will now have access to a greater number of providers and a wider range of products covering the entire annuity market."

Hub Financial Solutions is a subsidiary of Just Group, which was created in July this year, following the group's merger of its two existing businesses, Just Retirement Solutions and The Open Market Annuity Service.

David Cooper, CEO of Hub Companies, said: "We’re delighted that Prudential has chosen to partner with us to offer its customers access to the whole annuity market through our service.

"We know lots of people still value the security that a guaranteed income for life offers but don’t always shop around to find the best or most suitable product. We’ll be able to help thousands of Prudential customers understand their annuity options and then tailor an annuity to meet their personal needs by searching the whole market to find the very best deal for each individual customer."

Nathan Long, senior pensions analyst at Hargreaves Lansdown, said annuities still had a part to play in retirement, despite recent speculation that the market was "on its last legs".

"A flurry of under 65s with small pension pots taking their money out as cash has caused rumblings that the annuity market could be on its last legs, but there is plenty of evidence to suggest this isn’t the case," said Mr Long. 

"Annuities still have a hugely important role to play as part of a diversified retirement income strategy. This is particularly true as people get older, as they can get better rates and have less appetite to manage their pension for income," he added. 

Mr Long pointed to recent analysis from Hargreaves Lansdown, which showed the difference between the best and worst annuity rates was 17 per cent on average.

"There really must be question marks over pension providers who do not do their utmost to encourage would be annuitants to shop around for the best deal," he added.