Introduction
The with-profits market has been battered by poor short-run product performance, negative publicity and ever tightening solvency requirements on providers. UK with-profits 2005 analyses recent trends in the market, the key distribution channels and competitors. Forecasts are given for the future of product and distribution channels in the with-profits market.
Scope of this report
- UK with-profits 2005 covers the market for With-Profit Bonds and With-Profit Endowments, both mortgage and savings related
- The report uses ABI statistics, SynThesys Life database, extensive secondary sources and primary interviews with leading players and distributors
- The report uses Datamonitor's life and pensions forecasting model to forecast with-profit bonds and endowment new business between 2004-2009
- The report examines the potential of Distribution Bonds; CPPI and Target Return Funds as replacements for with-profit products
Research and analysis highlights
Between 2000-2004 With-Profit Bond new business declined at a compound rate of 42%, bringing down the majority of the with-profits market with it. Although the year-on-year rate of decline has fallen, with a year-on-year fall of 46% in 2003-2004 compared to 76% in 2002-2003, this is largely because there is little room left for the market to fall.
The decline of the with-profit market has resulted in several new products being positioned as replacements for the traditional With-Profits products, including; Distribution Bonds; investments using CPPI; Target Return Funds and ''New Style'' With-Profits. However, no one product will be able to take the place of with-profits.
Datamonitor forecasts compound With-Profit Bond new business growth of 1% between 2004-2009.This amounts to a total increase in new business of just ?10.4m over five years. New business levels will total ?160m in 2009.
Key reasons to read this report
- Market forecast: Identify the future of the market and examine the chances of success of alternative with-profit products
- Competitor intelligence: Identify the key market competitors and analyze recent competitive developments
- Market data: Understand the unit-linked market, distribution trends and key new business drivers
The with-profits market has been battered by poor short-run product performance, negative publicity and ever tightening solvency requirements on providers.