UK Personal Pensions market report
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Providing the most comprehensive and up-to-date information and analysis of the Personal Pensions market, and the behaviours, preferences and habits of the consumer.
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Products covered in this report
The main focus of this report is personal pensions and stakeholder pensions, which have been arranged by the individual. It is important to note that market size data relates only to individual business and excludes group personal pension (GPP) business.
GPPs and group stakeholder pensions (GSPs, also referred to as employer-sponsored stakeholder pensions) are covered in more detail in another report (see Workplace Pensions – UK, June 2016). Similarly, SIPPs are also the focus of a separate report (see SIPPs – UK, December 2016). However, it is worth noting that in the individual market (as in the group market) there is a certain amount of overlap between personal pensions and SIPPs, particularly the low-cost platform-based/streamlined variety, and so consideration has been given to this. For instance, the consumer survey covers all three types of individual pension.
In this report, Mintel uses the following definitions:
- Personal pension – a defined-contribution (DC) pension scheme, set up as a contract between the individual member and the pension provider (usually an insurance company or investment platform). An individual may also open and contribute to a personal or stakeholder pension on behalf of someone else, such as a partner, child or grandchild.
- Stakeholder pension – a type of low-cost personal pension that must adhere to certain conditions set by the government. This includes the requirement that the annual management charge (AMC) must not be more than 1.5% per year for the first ten years of scheme membership and thereafter not more than 1%.They were initially launched in 2001 to help boost pension participation in the workplace. Employers with five or more employees were required to provide access to a stakeholder pension scheme unless they offered a suitable alternative scheme. However, these requirements have been superseded by workplace auto-enrolment duties. Stakeholder pensions – both in the individual and group sectors – therefore remain a fairly small area of the overall pension market.
- Self-invested personal pension (SIPP) – a type of personal pension that offers individual investors greater flexibility and investment choice. There are two main sub-categories, catering for different markets: streamlined/platform-based SIPPs, including mid-range collective SIPPs; and full-range/ bespoke SIPPs.
- Individual pensions – an umbrella term for individuallyarranged personal pensions, stakeholder pensions and SIPPs.
Expert analysis from a specialist in the field
Written by Sarah Hitchcock, a leading analyst in the Finance sector, her extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.
The individual personal pension market offers good prospects for growth. A larger pool of pension savers due to auto-enrolment and prevailing mobility in the labour market will increase the tendency to accumulate multiple pension pots. In turn, this will drive pension transfer and consolidation activity. Moreover, there is scope to grow regular-premium business by targeting the self-employed and those interested in saving for children.
Senior Financial Services Analyst
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