Pensions net premium income up 18%

by Gill Montia

Story link: Pensions net premium income up 18%

The Association of British Insurers (ABI) has published provisional long-term “business in force” figures for 2008, showing how the recession and changes in Capital Gains Tax continue to impact on the UK insurance sector.

Last year, total net premium income for life insurance and pensions stood at £97.7 billion, down 2% from £100.2 billion in 2007.

Life insurance fell 22%, to £38.4 billion, however, net premium income for pensions rose an impressive 18% to £57.5 billion, a record high

Meanwhile, benefits paid to customers increased from £113.0 billion in 2007 to £126.8 billion last year, an increase of 12%.

The ABI’s director of research and chief economist, Dr Rebecca Driver, comments: “Against the background of a recession, it is encouraging that net pension income has gone up.”

She adds: “The fall in life insurance investments was to some extent unavoidable. The Government’s ill-judged changes to Capital Gains Tax have hit the insurance bond market, and we are seeing the effects of those changes here.”