Norwich Union, soon to be Aviva, has regained its position as the number one provider of equity release, following a series of product innovations and promotions during 2008.
Norwich Union, soon to be Aviva, has regained its position as the number one provider of equity release, following a series of product innovations and promotions during 2008.
The number one position in terms of revenue was confirmed when Norwich Union reported sales of £249 million, compared to £242 million for Prudential, the former frontrunner in the equity release market.
Milestones for Norwich Union in 2008 included launching the proposition in Northern Ireland in January and increasing the loan to value (LTV) scale for its lifetime mortgages in April 2008. In May 2008 the company decreased minimum cash payments for home reversion plans from £25,000 to £15,000 and increased the home reversion cash-to-release scale from 56% to 59%.
This was followed by a significant product enhancement launch in August 2008 which involved introducing a new suite of lifetime mortgages titled "Lifestyle". A high-profile TV and online advertising campaign in the summer of 2008 also helped contribute to the company's success.
Dominic Fraser-Smith, group product manager for Norwich Union, says: "Throughout the year we have consistently grown both our IFA and direct market share. According to SHIP figures the equity release market contracted by nine per cent in 2008, which makes the fact that we increased our business by 15%* in this market even more incredible.
"We have already seen a strong start to 2009, and we look forward to building on this achievement to benefit both our customers and advisers even further in the future."
Norwich Union equity release has seen its market share increase between Q1 and Q4 in 2008 from 6.5% to 27% (IFA) and 36% to 47% (Direct). It has also received recognition with two industry awards: Moneyfacts Best Equity Release Provider and Your Mortgage Best Lifetime Mortgage Provider.
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* (£217m 2007 vs £249m 2008)
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Notes to editors:
About equity release
Norwich Union is a leading provider of equity release plans in the UK. Source SHIP
Equity release is a way of unlocking some of the capital in your home and turning it into cash - without having to move. Norwich Union offers three types of equity release plan. These are known generically as:
- Lifetime mortgage: A loan secured against your home, with no regular repayments to make as the loan and interest are rolled up and usually repaid when you die or if you need to move into long-term care.
- Home reversion plan: Enables you to sell all or a percentage of your home in return for a cash lump sum.
- Lifetime mortgage including a drawdown option: A lifetime mortgage that enables customers to unlock some of the value in their home by releasing an initial amount of money and keeping a reserve fund available that can be released in future when required.
Taking a lump sum plus our costs will reduce the value you have in your home and therefore any inheritance you leave. You tax and welfare benefits may also be affected.
SHIP membership
Norwich Union is a found member of SHIP (Safe Home Income Plans), a group that was launched in 1991 and is dedicated entirely to the protection of plan-holders and promotion of safe home income and equity release plans. All participating companies are pledged to observe the SHIP Code of Practice.
About Norwich Union
Norwich Union is one of the UK's biggest life insurers. 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
In the summer of 2009 Norwich Union will change its name to Aviva. Aviva is the world's fifth largest insurance group and operates in 27 countries. Aviva is to become the customer brand worldwide, thus enabling the company to compete even more effectively on a global scale for the benefit of customers, staff, business partners and shareholders.