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Demand for annuities up 30%, says CFS

Demand for annuities up 30%, says CFS

Reporter
— 1 minute read

Flows into annuity products on Colonial First State's platforms increased by 30 per cent during the six months to September 2016.

Financial planner-led demand for annuities was up 30 per cent throughout the six months to September 2016 compared with the previous six months, said Colonial First State (CFS).

CFS head of retail sales Laird Abernethy said annuities usage is on the rise among planners as education efforts on their benefits increases.

"When we first launched annuities on the CFS platforms, we knew it was because advisers were looking for more efficient ways to deliver advice, particularly in retirement," Mr Abernethy said.

CFS announced the addition of CommInsure annuities to its platforms in July 2015, along with an agreement to include Challenger's CarePlus annuity on the FirstChoice platform in August 2016.

"More advisers are seeing the benefits of using annuities in conjunction with an account-based pension by constructing portfolios that provide a regular income from a lifetime or term annuity whilst benefiting from potential market gains and income from the account-based pension," Mr Abernethy said.

"We expect this to continue to grow as the demographic trends of population growth and increasing life expectancies become further apparent."

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Demand for annuities up 30%, says CFS
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