ABI calls 2023 a ‘milestone year’ for annuities

22 February 2024

Written by Retirement Line

Last year was a record year for UK annuity sales, according to the Association of British Insurers (ABI). The year saw UK consumers place £5.2 billion of their pension savings into annuities. This was the highest level since the ‘Pension Freedoms’ legislation of 2014.

The ABI reported on 2023 annuity sales earlier this month, with the headline news being a 46% increase over the previous year. The number of annuity contracts sold for the year was 72,200. The ABI point to this as ‘reflecting strong consumer desire to lock in a guaranteed income for their later years’.

Fuelling the growing popularity of annuities are annuity rates that are still well above the level of much of the past decade or so. Higher rates translate as more income for people choosing an annuity for some or all of their retirement income.

Rob Yuille, the ABI’s Head of Long-Term Savings Policy, said: “Securing a guaranteed income for life remains an important part of the mix of options for people to consider at and during retirement, and it’s great to see more people taking advantage of the protection they have to offer.”

The importance of shopping around for annuities

The ABI also reported that 64% of annuity buyers in 2023 shopped around for an annuity. This means they took an annuity from a different provider to the one they had their pension savings with. 

This confirms a trend for more people shopping around than used to be the case. But 36% might still be failing to compare annuities and potential income from other providers. 

Stephen Lowe of Just group says: “It’s good to see the majority are finding their way to the best deals which is a significant improvement on the past, but there are too many people still missing out.” 

Please see our guide to exercising your open market option for more information on how to shop around for the best retirement income from an annuity.

Can we help you find the right annuity?

Retirement Line specialises in providing an annuity service that includes securing the best annuity rate from leading providers. We also provide comprehensive information to help you choose the right annuity. Our dedicated administration team also liaise with your pension scheme and chosen annuity provider until your annuity is in place.

Speak to our friendly team today on 0800 652 1316 or request a free call back.