Our view
May 06 - UK: Norwich Union comments on outlook for equity release market
- Equity release sales in Q1 2006 worth Ł85m
Norwich Union believes the growing pensioner savings gap and the
amount of wealth tied up in housing will drive demand for equity
release products.
Daren Carter, director of sales and marketing at Norwich Union
Personal Finance, said: “The gap between what people need to
save for a comfortable retirement and what they are actually saving
is growing. Coupled with longer life expectancy, many pensioners
could face financial difficulties. With so much money in housing,
it seems sensible that people should now consider the role of
property in retirement planning. Equity release is one possible
solution, although it is not appropriate for everyone.
“A report from the Actuarial Profession* highlighted that the
aggregate housing wealth of people aged over 65 now stands at about
Ł1,100bn, and two-thirds of the wealth of people in this age group
is tied up in their houses. This fact was recognised in the Turner
report into pension provision.
“The introduction of new products and major brands entering
the equity release market – such as HSBC – will also
boost demand by widening distribution, and increasing consumer
choice.
“As the market grows it is important that customers receive
appropriate advice. Effective regulation will give advisers and
consumers the confidence to recommend and buy equity release
products, and we welcome Treasury proposals to regulate home
reversion plans.”
Last week Norwich Union announced that total equity release sales
in Q1 2006 were worth Ł85m. In Q1 of 2005 they were worth
Ł83m.
-ends-
* The Actuarial Profession Equity Release Report
2005
Press office contacts:
David Gwyer
01904 452828 Out of hours 07800 699508
Cheryl Cox 01904 452791 Out of hours 07800 695275
Louise Soulsby 01904 452617
Notes to editors:
Norwich Union is the largest
insurance services provider in the UK. It is a leading provider of
life, pensions and investment products and one of the largest
Financial Adviser (FA) providers. FAs provide over 70% of the
company's long-term savings business in the UK.
Norwich Union has strategic alliances with building societies and
other leading UK brand names including CIS and The Royal Bank of
Scotland Group. Norwich Union's news releases and a selection of
images are available from Aviva's internet press centre at
www.aviva.com/media