Legal & General’s retirement division has agreed a deal with Prudential to provide annuities to its customers with guaranteed rates.
As part of the arrangement, from November 1, 2019, Prudential customers with guaranteed annuity rates will be introduced to L&G.
The deal means that all guaranteed annuities will be underwritten by Prudential but will be distributed by L&G.
When fulfilling these annuities, L&G will also compare the whole market to see if the rate can be improved and will help Prudential customers obtain a better rate if one is available.
The is the fourth introducer agreement in the annuities market for L&G, following similar deals with Aegon, ReAssure and Sun Life Financial of Canada.
Emma Byron, managing director of Legal & General Retail Retirement Income, said this deal reflected the importance of keeping consumers informed about their options in retirement.
Ms Byron said: “For many retirees, we believe annuities can play a central part in retirement planning. I’m therefore delighted to announce we are partnering with Prudential to offer their customers the option of a guaranteed income from an annuity.
“As an industry it’s vital that we continue to work together to keep those who are approaching, and in retirement, informed about their options so that they can choose the best solution for their individual needs.
“It’s the fourth introducer agreement Legal & General has secured for our retirement Income business, and we look forward to a long and successful relationship with Prudential and their customers.”
L&G’s recent half-year results, published August 7, revealed significant growth for its individual annuities business with sales up 47 per cent to £497m in the first six months of 2019.
The firm expects its deal with Prudential to increase its annuity sales in 2020 by 15 per cent.
In February 2017, Prudential pulled out of the annuity market completely, eight months after it pulled out of the open annuity market.
At the time Prudential said that the decision to exit the annuity market entirely will allow the firm to focus its retirement business on retirement drawdown products.
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