Legal & General Retail has revealed its annuity sales have reached an all-time high of £2bn so far this year.
This milestone is reflective of a resurgence in annuity purchases across the market.
The Association of British Insurers has reported a 50% increase in sales in the first half of 2024, compared to the same period the year before.
L&G’s sales are up 55% compared to the same week in 2023.
While improved rates on annuities have been a driver of this growing demand, there’s also increasing awareness of the other benefits a guaranteed income can provide.
A recent study from Legal & General and the Happiness Research Institute, an independent Danish think tank, looked at the link between annuities and happiness.
The study found that retirees with an annuity score more positively across multiple wellbeing measures than those who don’t.
It also discovered annuity holders more likely to report the highest level of financial confidence compared to those without one (24% versus 21%).
Legal & General managing director, retail retirement, Lorna Shah, said: “Annuities continue to be a great choice for many, providing income security in later life.
“Improved rates, which mean people can get more for their money, have played a key role in driving interest, but this isn’t the only factor.
“Together with the Happiness Research Institute, we’ve shown how the certainty of an annuity enables a happier retirement, removing the fear of outliving savings and providing retirees with a sense of financial security that eases stress and uncertainty.
“The good news is that retirees have options. It’s not an either-or decision.
“Combining the guaranteed income of an annuity with other sources, such as income from investments or drawdown, can provide even more flexibility, ensuring that essential expenses are covered, while offering the opportunity to grow other assets.”
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